Here’s What We Need For This Market To Continue Up
“I am not saying the end of
the world is coming. It is just easiest to isolate early weakness while the
market is strong. With major indices extended, with froth and speculation
starting to pervade the market, with just about everyone I hear saying December
will be powerful, I feel it important to get your feet back on the ground and
make sure you deal with the tape. There are still plenty of positives out there.
There is still plenty of leadership. It just feels like we are about ready for
more than just a one day correction at this time…and a few areas are now
starting to act suspect.”
That was the last paragraph of Monday’s report.
Did I tell you that I also bet the Germans in the Pearl Harbor War? Just
borrowing a line from Animal House. Very simply, another
correction/consolidation that lasted a minute before moving out.
So….has anything changed? Not much! The names I
mentioned in my last report are still lagging…and badly. RETAILERS. for the
most part, are still acting suspicious. BONDS are still topped. But the “market”
continues on. One can only be impressed with price and volume patterns as the
market has been moving up on heavy volume, consolidating on light volume…and
then yesterday, moved out on heavy volume again. The SEMIS did jump smartly on
Wednesday. In order for this market to continue up, the SEMIS will need to
participate. They still lag the overall market by a wide margin.
OIL dropped $3.65 yesterday, the biggest one-day
drop since Sept of 01. This is only good news. After bouncing up recently, OIL
looks to be toast…and probably for the intermediate-term. Keep in mind, this
commodity is very event-driven.
Gary Kaltbaum