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When to Capitalize on Capitol Hill

By  +Follow October 4, 2013 1:24PM
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With the political wrangling going on in the nation's capitol, Wall Street is once again stuck under a cloud of uncertainty as to the direction of the economy. But even considering what is at stake, the markets have held up relatively well since the shutdown took effect. We asked Toni Turner of TrendStar Trading Group on why and how traders and investors have managed to keep their cool thus far. 

Q: Were you surprised how well the market has held up for the most part after government the shutdown?

Turner: The markets have held up well, considering the stalement in D.C. We have to remember that this is the 18th shutdown since 1977, and differences—for better or worse—have always been worked out. As the famous Winston Churchill quote goes, “The Americans will always do the right thing … after they’ve exhausted all the alternatives.”

That said, the market is skeptical now, if not panicked. Most investors expect the powers-that-be on Capitol Hill to come to an agreement that will reopen the government and keep the federal government rising up to the debt ceiling. Still, it may be an emotional journey to the resolution destination. As such, I’m remaining on the sidelines here, executing only intraday trades. I am not adding core positions right now, because I want to be more convinced this environment offers high-quality buying opportunities. .

EQ: Based on how stocks are treading water right now, is the market positioned to pop on any surprise resolutions? Or is the risk of the effects of a prolonged shutdown greater?

Turner: If we get a resolution in Washington within the next few days, I do believe the market will pop and I believe that because at the moment the Russell 2000, which can lead as a leading indicator for the broader market, is still side-stepping along its all-time highs and has mostly ignored the events going on around it. Now, that may change, but that is what it is doing at this moment in time.

Should the iShares Russell 2000 Index ($IWM) break $104, which is where the 50-day moving average is, then I will pay more attention. So far, the iShares Transportation Average ETF ($IYT) is also holding up very nicely above its 50-day moving average. Even though the market sold off a little more toward the end of the day Thursday, the VIX came off of its highs above 18, so it does show that the market is not yet willing to fall dramatically, which tells me that it’s stronger and more resilient than we think.

EQ: Earnings season kicks off next week. What are some trends or developments that you’re monitoring?

Turner: I’ve been watching price-to-earnings ratios climb for the last two quarters, so for the third quarter, I’m really anxious to see if earnings can catchup with price for the fourth quarter. Typically, the fourth quarter can be one of the best of the year. If interest rates begin to rise—and they have—then I’m interested to see how that will have affected earnings.

EQ: Any sectors or industry groups that have caught your attention right now?

Turner: I like the iShares U.S. Healthcare Providers ETF ($IHF). Healthcare providers are going to be getting more customers by virtue of the Affordable Care Act, and there’s nothing like getting more new customers to help a business grow. For that reason, I’m watching the IHF here. Despite the market’s misery the last three or four days, the IHF has been climbing. If it can remain above the $86-$87 level, then perhaps it keeps going higher. Readers can go to iShares.com and check out the holdings in the IHF and see if there are any names there they’re interested in. The one I’m watching right now is Molina Healthcare, Inc. (MOH) , because it is big Medicaid provider, which will be expanded under the ACA.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for iwm
Woll Street
21 Oct 14 05:56:34
https://t.co/Mwor2ZPear $IWM support/resistance lines... a retest of 109.85 is 1st target > 109.35
Phil Davis
21 Oct 14 05:40:57
What Lines We're Watching and How to Play them in our Short-Term Portfolio: $SPY $IBM $DIA $IWM $TNA #Hedging -- http://t.co/a6zojiLUZo
momotrader
21 Oct 14 05:19:19
$SPY $IWM - everything occurring so far from my weekend thesis. Up Monday. Gap up Tuesday. I say red close today. Lets wick this market.
Brian Kroll
21 Oct 14 04:16:32
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Fred
21 Oct 14 04:15:03
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
susan markham
21 Oct 14 04:12:21
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Sharon
21 Oct 14 04:11:30
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
16W Trading
21 Oct 14 04:10:56
$TF_F looking for a short opp only f loses yesterday high $IWM
Jeremy
21 Oct 14 04:10:24
RT @RedDogT3: $iwm is trying to show it could be more then a bounce. A small inverse H&S pattern building. If it clears $109.5 then $112i…
Smartsoft
21 Oct 14 04:09:51
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Tré Melvin
21 Oct 14 04:07:29
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Odessa Chamber
21 Oct 14 04:07:05
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
VERONICA
21 Oct 14 04:05:58
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Jonathan
21 Oct 14 04:05:25
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Ed Turi
21 Oct 14 04:03:08
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
WinningStockCoach
21 Oct 14 04:03:01
Let's get prepared for the #trading day ahead! http://t.co/VHF6GbCTvC $SPX $SPY $DJI $DIA $RUT $IWM $NDX $QQQ
Annette Ashley Smith
21 Oct 14 04:02:19
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
IVR Technology
21 Oct 14 04:01:27
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Pamela
21 Oct 14 04:00:23
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Patrick
21 Oct 14 04:00:04
#TOPTICKERTWEETS $AAPL $SPY $QQQ $IWM $DIA $OME $IBM $SPX $O $USD #quantheta
Patrick
21 Oct 14 04:00:04
#VOLUMESHIFTUP $OME $HE $IBM $O $ABBV $DIA $CMG $IWM $QQQ $AAPL #quantheta
Patrick
21 Oct 14 04:00:03
#SENTISHIFTUP $O $YHOO $GOOG $AAPL $IWM $GLD $AMZN $QQQ $DIA $SPY #quantheta
Herman Beck
21 Oct 14 03:58:39
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Karoline Haddinton
21 Oct 14 03:57:11
$IWM, $TNA, $RUT index took the whole market with it,Nose buried into 1080 support oversold http://t,co/yPhqUVx896 http:
kirksnotes
21 Oct 14 03:56:33
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
The ICCT Clean Fuels
21 Oct 14 03:53:32
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
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21 Oct 14 03:48:57
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
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21 Oct 14 03:46:49
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Robin Murray MD CFII
21 Oct 14 03:46:08
We like $AAPL quarter but do not like market action $SPY $IWM $DIA choppy sloppy droopy and droppy SO we will wait for #Apple dips to buy.
Ariel
21 Oct 14 03:45:13
RT @RedDogT3: $iwm is trying to show it could be more then a bounce. A small inverse H&S pattern building. If it clears $109.5 then $112i…
Maggie
21 Oct 14 03:44:49
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Tregg
21 Oct 14 03:43:45
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
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21 Oct 14 03:40:39
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
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21 Oct 14 03:37:54
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
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21 Oct 14 03:37:33
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21 Oct 14 03:35:06
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21 Oct 14 03:33:30
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Narmada Marshfield
21 Oct 14 03:32:50
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mnlewis
21 Oct 14 03:32:23
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Robin Murray MD CFII
21 Oct 14 03:24:42
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Katie
21 Oct 14 03:24:41
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21 Oct 14 03:24:02
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21 Oct 14 03:21:39
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21 Oct 14 03:19:47
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21 Oct 14 03:13:54
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RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Mark Newton, JEA
21 Oct 14 03:10:05
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Melville Mccabe
21 Oct 14 03:05:31
RT @lancejepsen: GST Stock Trader News $SPY $IWM $QQQ http://t.co/EGAtUyzphe
Jessica
21 Oct 14 03:01:11
RT @philstockworld: The Levels We're Watching and the Positions We're Taking for the Week Ahead: $SPY $DIA $QQQ $IWM $AAPL -- http://t.co…
Stock Forums
21 Oct 14 02:59:33
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By  +Follow October 4, 2013 1:24PM
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