We keep tip-toeing around the lows of 7,400 or so in the Dow we hit in November.
It seems like, out of the gate anyway, that Obama effect many were looking for has been a no-show.
Layoffs continue at a break-neck pace and the consumer is tired and broke.
Bottom line: It’s a long way up and it may also be a long way down.
But there may be opportunities there for the more astute and gutsy of investors out there.
Those opportunities come in the form of trading in a range.
The current market’s oscillation between the high 7,000 range and the upper 8,000 range lends itself to investing in stocks that are exhibiting the same action.
In other words, if you spend a little time watching a particular stock or two, you’ll get hints about how their price action follows that of the overall market.
Over time, you’ll find a range in which those stocks are trading.
Buy in when the stock is at the bottom of its range and sell when it gets near the top.
Sounds simple enough, you say.
But it’s not. In fact, it can be a little challenging — and nerve-wracking — figuring out when to buy in at the right time and how to sell before it falls again.
Apple (AAPL) and Dryships (DRYS) both seem to be good candidates for this strategy.
Apple’s been oscillating between the 80s and high 90s since October, a peek at its chart on Bigcharts.com shows.
Its track record has been pretty decent and could make a good range-trading play — if that is, something sensational like CEO Steve Jobs’ recent leave of absence for health reasons doesn’t beat the price down even more.
Dryships also had a tradeable bounce in the last few weeks, going from about $9 a share to around the $14 range.
Even after taxes on a short-term trade, that 5 points wouldn’t be anything to sneeze at.
Is this investing? No. Is it more akin to gambling? Absolutely.
But with the market in the state it’s in, buy and hold is obviously not working.
Unless, of course, you’re buy-and-holding cash or CDs.
Fishkind says more pain ahead
Henry Fishkind, a noted Florida economist, was in town last week to give his annual Economic Forecast Breakfast, sponsored by Whitney Bank and the Manatee Economic Development Council.
More tough times ahead.
Fishkind predicted that economic output and the housing market won’t start showing signs of life until at least the latter part of this year and a full recovery shouldn’t be expected until 2011 or 2012.
But Fishkind also said that the recent stimulus programs from the government, and the others to come, should ensure we get back on solid footing.
Let’s hope so.