There is no other way to describe the last couple weeks in the market other than choppy! From a master reversal and bottoming tale on Friday was a beauty. It essentially told me we would go into a short term choppy upward direction. That is exactly what we have gotten. Monday saw a pullback or what I would call an inside day, in spirit of bullish consolidation. Tuesday the markets soared higher off of that bullish consolidation and now a choppy, quiet volume on Wednesday.
The markets sold hard at 10am ET as Ben Bernanke's comments were released to the public. He had been expected to speak, however, due to the snow storm it was canceled. In his released comments, talk about future tightening finally showed itself for the first time in years. This caused the dollar to get a spike higher and the markets to drop sharply. As the 11am ET hour approached, the markets began to see a lighter volume float higher. Of course this was due to the fading dollar. Overall, volume is light on the back of a nasty snow storm hitting New York City and Wall Street.
Stocks in motion today are United States Steel Corporation (NYSE:X) and Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX). The reason for the *In Play* status is due to a technical gap fill hit on the charts that signaled a bottom and a bounce. Both these stocks sold hard on the dollar soaring off of Bernanke's statements, then as the markets have recovered, they have bounced solidly. Note the charts showing gap fill support below.
Other stocks in *In Play* are Baidu, Inc.(ADR) (NASDAQ:BIDU). This Chinese search engine Google wannabe reported great earnings and a solid outlook. The stock is up almost 9% on the day. In addition, the small cap Labopharm Inc. (NASDAQ:DDSS) is showing signs of short covering and a bounce. A week ago they received FDA approval for a key drug that has some great potential. It was a perfect sell the news event. The stock had run up prior to the FDA from $1.40 to a pre market high of almost $3.50 on the FDA decision. Since then it has fallen all the way back to an extremely attractive level of $1.80 - $2.00. The key for them is can they ink a deal with a big pharma to help them promote the drug. Note the charts bellow of BIDU and DDSS.
Chief Market Strategist