This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The Market's Roller-Coaster Ride Continues With Volatility at the Forefront

NEW YORK (TheStreet) -- As I've noted before, this stock market has become a "buy the dips and sell the rips" market. Well, Wednesday proved to be very accurate.

The DJIA was up over 70 points in early trading. However, the index could not hold onto those early gains and finished down on the day by 31.75 points at 16880.36. The S&P 500 was up fractionally at 1970.07. The Nasdaq closed higher by 20.20 points at 4462.90, led by the momentum favorites Facebook (FB) and Twitter (TWTR). The Russell 2000 closed higher by 4.93 points to 1146.57.

The second-quarter preliminary GDP report was released and showed a roughly 4% increase. On the surface, this numbers looks fantastic. The number will be revised lower as we move forward but it appears the U.S. economy is gaining strength. I say, not so fast.

The U.S. GDP for the first half of 2014 is 0.87% annualized. The Wall Street pundits were looking for an increase of 3% to 4%. I believe the GDP is also slowing again sequentially in the third quarter.

So, I will stay with my "growth slowing, inflation accelerating" macro theme for 2014. I am surely in the minority with that forecast. However, the growth slowing indicators are what they are. Aside from Wednesday, the leading sectors in 2014 continue to be the utilities, energy, precious metals and real estate investment trusts.

The stock market is now confused as to which direction it wants to go. The DJIA and the S&P have been in a profit-taking mode while the Nasdaq and Russell 2000 are forging ahead. This is a two-tiered market again; the DJIA and S&P versus the Nasdaq and Russell 2000.

The DJIA is now sufficiently oversold according to my algorithm numbers that a turn higher should be expected over the next day or two. The question becomes, will we get a rotation out of the Nasdaq and Russell 2000 stocks into the DJIA and S&P stocks?

This is a traders market. This is no time to commit for a longer-term investment. The volatility, as highlighted by the CBOE Market Volatility Index (VIX.X), is once again at the forefront.

Thus, stay focused and continue to buy those oversold sectors and stocks that are highlighted at

As mentioned Tuesday, my long positions in Monsanto (MO) and Lam Research (LRCX) were sold after the market open for better than 1% gains again. Those internal algorithm numbers are pristine.

At the close of trading on Wednesday, I added a new long position in Flowers Foods (FLO) and added back Lam Research (LRCX). Both are extremely oversold.

At the time of publication, the author was long FLO and LRCX, although positions may change at any time.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $92.44 -0.86%
FB $119.14 1.10%
GOOG $710.08 1.20%
TSLA $214.80 1.50%
YHOO $37.22 0.76%


Chart of I:DJI
DOW 17,728.75 +68.04 0.39%
S&P 500 2,055.44 +4.81 0.23%
NASDAQ 4,727.7440 +10.65 0.23%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs