- New Trades -

Editor's Note:

(September 29, 2013)

No new trades tonight!

The S&P 500 is down six out of the last seven trading days as market participants prepare for a U.S. government shutdown. Thus far the profit taking has been pretty mild. Only the S&P 500 and the Dow Industrials seem to be affected. The NASDAQ and the small cap Russell 2000 index actually look relatively strong. However, if the political turmoil in Washington heats up this week or if the U.S. credit rating gets downgraded again, it could accelerate the market sell-off.

The U.S. budget battle and the U.S. debt ceiling issue will eventually be solved. However, until then investors should stay defensive. We want to use any market weakness to our advantage but we'll have to be patient. Until we see a deal in Washington the best strategy might be to sit on the sidelines and wait for the dust to settle. Odds are good we will get a chance to buy LEAPS options on stocks at lower levels in the next two or three weeks.

I would focus on strong stocks and look to buy a correction near support. A few stocks that caught my eye are symbols like: AMZN, FB, FLS, LVS, N, BA, NKE, TJX, CMI, CBI, SWY, RGR, and SBUX.