Joshua Hayes'  Instablog

Headlines over the weekend were quite dismal stoking the fire further over the European crisis. The market set aside the fear and jumped to the highs of the day right out of the gate. Factory orders were on the light side sending the market lower. From 10 am forward the market would oscillate throughout the day settling mixed on the session. Volume was lower on the day, but again low volume is par for the course for Mondays. This market is still searching for a bottom here and our trend is still down.

Another new low was set today and a lower low at that. April's high was the lower high we have mentioned in the past and with the market continuing to set lower lows the bear tightens its grip on this market. Sentiment is negative, but we have yet to see any panic get into the market. We may not see panic selling, but we still have yet to see any high volume reversal to signal a possible rebound. In 2011, we saw the market sell off and rally back to new highs a few times before the August sell-off. So far, we haven't seen the ability for this market to find a bottom.

It would be nice for a bit to ignore what is going on in Europe. The situation in Europe feels like it has been going on since the Bear Stearns collapse. However, Greece two years ago kicked off the crisis. There is a lot of commentary on the ramifications of Greece leaving the Euro versus staying and this goes for the other EU countries. When you get right down to it we'll be hearing about this situation for a long time coming. At some point markets will simply sniff out the plan and price accordingly. The real bogey here is what is going to happen with the Fiscal Cliff and a renewed debt ceiling debate. Tear the band-aid off fast and do what is necessary.

It is safe to say many will be predicting the outcome for the stock market. Many will be wrong of course and the trend followers will win. We only care about price and sticking with the trend. This is how wealth is created and built upon.

Make this week a great one!