Stuck at Resistance

February expiration day, Dow down 7 of last 10

Read this carefully: http://www.ft.com/cms/s/0/49639438-1b21-11df-953f-00144feab49a.html

Wal-Mart reports today and it's predicted the Philly FED for February will notch up.
Many traders have asked recently about what "high frequency trading" is, and how it affects day and option trading.

If I call up my broker and say buy 100 shares of Alcoa, and the broker trades for himself before my order, that is illegal because he knows my order is there.

But slimey old Wall Street began using computers to find signals in the market, get in front of what they believe is going to happen, and relies on speed. Some of these participants (we're sure taught by Goldman Sachs) have been using ways to look at orders before anyone else can see them. This moves markets to extremes, what we have been seeing, occurs because skimming for fractions of pennies occurs, and false signals are thusly sent to the marketplace by confusing volume and liquidity, which are not the same.

As a cynic I believe the SEC (which I am the most cynical about) will enact laws to calm high frequency trading, but they will have enough loopholes to allow Goldman and the boys to find another way to "bet the world."

Futures by 8.52 a.m. yesterday had held steady for several hours at 35 to 45 points up, with housing starts (one of my favorite false and useless statistics) were better than projected. Thusly, traders could have paid up slightly to 13.60, but profits as of 2.00 pm were minimal. We do not list this position as open, as it was never available at prior day close, and we advised not to "chase."

This all was true because SPX 1100 is a huge resistance area as is 505 on the OEX. Watch the tops that occurred yesterday and compare carefully to our Dow projections listed below.

We are right on target.

But....we're now flat lining. "Stuck at resistance."