Monday Morning Musings

The market is down just below the flat line in early trading. Asian markets were mixed overnight, with China still closed for a holiday. European markets were lower before the open.

Over the weekend, there were a handful of M&A deals in biotech, tech, and energy. I see this trend continuing as companies have a lot of cash on their balance sheets, interest rates are extremely low, and valuations of potential takeover targets remain reasonable.

Among ETFs, defensive sectors like utilities (+0.40%) and consumer staples (+0.11%), while energy (-0.90%) and basic materials (-1.10%) are lower.

The dollar is bouncing a bit today, which is weighing on commodities. Oil prices are down to $81.30, and gold prices are off a bit near $1313.

The 10-year yield is lower again to 2.48%; and the VIX is +4.0% to 23.40, which is right about where the 50-day average resides.

Trading comment: The market is working off its recent overbought condition, mostly by trading in a sideways fashion again. It still feels like bears are unable to gain much traction in terms of knocking the market lower, and underinvested bulls are looking to buy any dips. Market leaders continue to hold up well, and hopefully a few will offer good buy setups at some point. MELI is one that I am watching, as it is pulling back to its 50-day average today. AKAM is also getting close to its 50-day. And Ford (F) looks like its breaking out today from its recent consolidation.

long F