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MLR - PMP 12/2/13

The short Friday trading sessions remained relatively quiet as the major market averages traded mixed on lower holiday volume. The NYSE did trade 4% above Wednesday's levels by the 10:00 a.m. PST/1:00 p.m. EST closing time as the NYSE-based indexes, including the S&P 500 and the Dow, gave up early gains to close roughly flat, while the NASDAQ continued to outperform as big-stock NASDAQ names like AMZN, PCLN, and GOOG closed at or near all-time highs and AAPL continued on a third day of a breakout and rally from a very tight four-week flag formation.

While some may be tempted to extrapolate Friday's shortened day's trading volumes to a full day to see whether significant action in the indexes or a pocket pivot buy point in an individual stock occurred, this can be misleading since most holiday volume is retail volume as institutions are generally on holiday on the Friday after Thanksgiving. Short trading days like Friday that occur after a holiday such as Thanksgiving tend to be upwardly biased due to the seasonal effect of retail investors in good moods during this holiday trading day. Thus, it is better to weigh price/volume action leading up to the Friday as more important should you wish to consider buying a particular stock. Should fundamental and technical action be leadership quality, we would have put out a report on such a stock with the caveat that the volume on Friday extrapolated to a full trading day, while enough to qualify for a pocket pivot, should be weighed lightly.

Futures are up slightly this morning as the Friday quiet carries over into today's "Cyber Monday," the supposed kick-off to the holiday shopping season that comes on the heels of the retail "bricks & mortar" holiday shopping kick-off on "Black Friday." AMZN is looking to gap up about 1% this morning as a result of strong expectations for the day's online shopping activity. Otherwise, not much else is going on among individual stocks as we move into the final trading month of the year.

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