As the drama continues around the fiscal cliff in Washington, the Dow huddles around the 13,000 level. Bulls look to the tea leaves and assume we won’t go off the cliff.
In my opinion the level between 13,000 and 13,200 should be scaled into on sells. there is a wall of resistance up at 13,500. and support below down at 12,400. That’s 1100 pts worth of sideways churn from my perspective.
Sell into the highs and try to get long on the break.
If we move sharply above 13,500, then take losses on shorts and move on.
I am not in a real hurry to do any thing other than let the market come to sell orders by appointment.
Day by day the market could have a 300pt range and have it be statistically a non factor. The wider 1000 point trading range is what I’d be focusing towards.
That being said, the surprise would be a rally. A lot of traders are bearish on Washington and the fiscal cliff.
Quite honestly, I’d be laying low in December, trading very small and only on the extreme moves of 300 pts or more either way.
CER