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Minyanville's T3 Morning Market Call: Market Remains Choppy Around 21-Day Moving Average


The S&P 500, economic data, and Apple should be on investors' radar.

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US stock futures are currently around the flat line as the action remains choppy. Markets have been running in place over the past week, with the S&P 500 (INDEXSP:.INX) hovering around the 21-day moving average. Economic data will be in focus today with the ADP employment report at 8:15 ET and ISM survey of business confidence at 10:00. Yesterday the ISM manufacturing survey showed a resumption of growth, and triggered a morning move higher. (The ADP report this morning came in better than expected, showing 162,000 new jobs created.)

Apple (NASDAQ:AAPL) remains volatile and will be firmly on traders' radars today. The stock topped out above $700 per share after the unveiling of the iPhone 5, but lackluster first weekend sales triggered a drop in the stock. Apple lost its 21-day moving average last week, and retested it with a reversal on Thursday, but yesterday finally got the move down into the 50-day moving average that we had been looking for. After kissing that MA yesterday, dip buyers now have a defined level to trade against. Apple suppliers have reportedly began production on parts for a smaller tablet that will likely compete with the lower-cost, smaller tablets from the likes of Amazon (NASDAQ:AMZN), Samsung (PINK:SSNLF), and others.

The precious metals continue to hold up well while one world central bank after another introduces new monetary policy. Gold (NYSE:GLD) dipped below its 8-day moving average for a day last week but quickly climbed back above it, and silver (NYSE:SLV) also remains above its 8-day MA. The metals are in a tight upper level consolidation and will likely yield a trade if they break above or below key resistance or support.

MetroPCS (NYSE:PCS) is slightly higher overnight after yesterday's 17.8% move higher that came as a result of a leaked M&A deal. T-Mobile is in late-stage talks to acquire the cellular company, a move that would short up two struggling providers. The deal is much less likely to encounter regulatory concerns that stopped the much bigger AT&T (NYSE:T) for T-Mobile deal in its tracks last year.

As we have been harping on in our newsletter, this choppy action is not conducive for successful active trading. Stick to a very stock-selective plan and do not make big bets in either direction until we get more definitive clues about which direction the next leg of the market will go.

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Scott Redler is long AAPL, FB. Short SPY.
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