Establishing The Trend


Equities are beginning to trend again and much to traders’ delights, it’s familiar territory.

The first week of trading in 2012 has followed the trend of a percentage point-esque drop in the major U.S. indices in the morning followed by a slow climb into positive territory by late afternoon.

Financials in particular gained heavily in Thursday’s trading, sending bank stocks and related ETFs higher with some gaining over 5% by the close. Volatility remains low with the CBOE Volatility Index (VIX) hovering at the 21 point level – very close to dropping below 20 by week’s end.

The other trend that has begun to emerge is energy. Natural gas is expected to stay flat or head lower as we get further into 2012. As for crude oil, the $100 a barrel level is the norm for now unless an event occurs in the Middle East, which could instantly spike it into $150 a barrel territory.

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