Every day there are new headlines about the rising price of oil, unrest and violence in the Middle East and North Africa. Thus far investors have been able to shrug off most of the negative news in favor of strong economic data in the U.S. Yet how long can this continue? Eventually oil and gasoline prices will start to have an impact on consumer spending.
The market's trend is up and traders continue to buy the dips but I am growing more cautious on stocks. There is a chance that the market consolidates sideways for a while. That would not surprise me this week with the "day of rage" protests scheduled for Friday in Saudi Arabia. The market might hold its breath until after Friday, March 11th to see what happens.
We do want to respect the trend and that trend is higher but do so carefully. I am not adding any new bullish plays tonight since we have seen our play list grow considerably in the last couple of weeks.