MARKET SHOWING WEAKNESS

There isn't much success in trying to gauge future market moves during an options expiration Friday. In fact, you can sometimes make some big mistakes by drawing too many conclusions to the technical indicators that come out during that Friday. The buying and selling can be due to decisions that are related to option positions and not necessarily to an expected future movement of the stock...at least not a future beyond the closing bell on Friday. Stocks that barely break above or below support/resistance lines (on an expiration Friday) don't always reverse the trend. Now since we broke support last Tuesday...and not Friday...I can use that indicator to stick to my belief that the market is weak and the bears are gaining some control. If you watch the close of the market (one of my favorite things to do), you can see that it has been selling off recently in the last hour of trading. I've also noticed that when good news has come out recently, the market can't seem to go higher. The market has also seemed to have priced in most of the news that is coming out. The FED is meeting next week and debate is whether or not the announcement they make has already been factored into the current market levels. If this is true, the market will most likely sell off this week...even if the news is perceived as being good or positive. It would probably take some sort of unexpected good news to cause the market to move up enough to break through any resistance levels. On the other hand, any bad news could really drive down an already weakening market. Energy is showing some short term weakness. This sector has usually been moving in the opposite direction as the dollar. When the dollar falls, energy usually goes up. The dollar has been falling over the last few trading days, but energy has also been falling. This could mean that energy could pull back some more. Keep in mind that this is a short term expectation. I still believe that energy is almost a "can't miss" bullish trend for the next year or two. The bearish patterns I like are still the DIA or SPY.