Well, here we go again, hours away from watching the show that is the markets. This week again is going to be more about every word out of Washington about the fiscal cliff than about chart patterns, trends, or fundamentals. Right now I do believe that the markets are pricing in a resolution to the cliff, but if  and when it is resolved that will clear up the uncertainty and we should see nervous money flow back into stocks in a relief rally. The major indexes reflected in the $SPY and the $INDU are both holding support at the 50 day line. It is crucial that this line holds, a close below signals a new possible down trend. This is a dangerous environment. Apple is no longer the leader of the market  it has imploded losing every major support level in a manner of months. My game for the remainder of the year will be risk management as my #1 focus and playing volatility through long weekly option strangles. If you are not a day trader and do not use non-directional option plays this is a great time to sit back and watch the show and track your watch list for possible set ups for your trading method after a resolution has been met to the fiscal cliff. I fully expect from the looks of these charts for volatility to expand. The move on Apple Friday was hard to even believe. Apple’s current range is $505 support and $520 resistance (old support) which one breaks first and closes through it may signal a whole new trend.

I believe right now there is little edge in trading this market directionally with all the choppiness and over hanging headline risk.

Remember “Anything can happen.” Protect yourself here.