From September to early November, the volatility was staggering, and if you were on the side of the major trend (down), you've made money. But now traders are grumbling that there just isn't enough volatility to make trading profitable.On Friday, Standard & Poor's reported that in the past 22 days, the S&P 500 has remained between 805 and 874, or within an 8% range. But during the past 12 days, the closing price range for the "500" has been only about 50 points.
On Thursday, it looked like the market was breaking down for a test of the November low, but a late rally turned Thursday into a major reversal day (up). And so on it goes, with the same support zone at S&P 800 to 820 holding firm while the Dow has fallen slightly below its support. The NYSE Composite has held firm, and the Nasdaq has formed a small "V" type bottom (which is bullish).
Investment advisers continue to be bearish, the American Association of Individual Investors (AAII) members' survey shows that the public is still bearish (although not at the same level as the past four weeks), and insiders (especially bankers) are buying their own stocks (which is bullish).
I hate to say it but it looks like the future, as far out as I can see (which is only several weeks), is more of the same boring sideways movement with some whipsaws that could catch traders as they try to adjust to a less-volatile environment.
While the market trades sideways, I'm looking at Gabelli Global Gold, Natural Resources & Income Trust (AMEX: GGN), my trade of the day, to make a move higher.
Sam Collins is a contributor to OptionsZone.com.
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