daytrade diaries... wednesday

Morning traders.

Market wrap: US stocks slipped for a second day as nervous investors bailed out before the earnings season got underway. The major indexes shed 2.3 - 2.8% before Alcoa released a worse-than-expected quarterly operating loss after the closing bell.

There was red across nearly all sectors, with REITs down 8.79% and banks off 3.5%. But the gold/silver index finished ahead as gold found buyers after its recent slide, recently trading up 1% at $882. Oil continued to fall, dropping 3.5% to $48.60 on renewed economic worries. Base metals were mixed but generally held this week's strong gains, with copper continuing to advance.

Futures traders found no reason for our market not to follow global markets south today. The SPI closed down 58 points at 3682.

Alcoa's result is a warning shot that this US earnings season could be messy. If companies disappoint over the next few weeks, the global rally could unravel quickly. If you're new to trading, now is the time to add stop-losses to your trading discipline - otherwise you may soon be just another ex-daytrader with a bottom drawer full of "investments" you'd prefer to forget. A downturn is certainly not guaranteed but the optimism of the last month is going to be tested and markets are likely to be volatile. Trade safely.

Today, I'll look for oversold stocks for bounce trades after the initial sell-off. Currently holding RDF and FMS and looking for them to build on yesterday's gains.