The one constant in this market
Gary Kaltbaum is an investment advisor
with over 18 years experience, and a Fox News Channel Business Contributor. Gary
is the author of
The Investors Edge. Mr. Kaltbaum is
also the host of the nationally syndicated radio show "Investors Edge" on over
50 radio stations. Gary is also editor and publisher of "Gary Kaltbaum’s
Trendwatch"…a weekly and monthly technical analysis research report for the
institutional investor. If you would like a free trial to Gary’s Daily Market
Alerts
click here. 888-484-8220 ext. 1.
Since May 11, the market
has had a brutal time of it. We have seen big drops on volume and
bounces on light volume. Throughout this mess, the one constant was the
inability for certain areas of the market to lead. This included RETAIL, TECH,
TRANSPORTS and other consumer areas. In fact, all have been at recent lows even
though the DOW/S&P had bounced off the lows.
Yesterday was the first day we have seen life in these areas. It was the first
wake-up call we have received since the top. Let us be clear. If
TECH/RETAIL/TRANSPORTS and the like can get going, the market will break above
intermediate-term resistance and help this market higher. That’s all the bulls
could ask for.
As I write this, the market is gapping up on a worsening economic outlook.
Believe it or not, that does make sense. Don’t ask. In the past few years, most
all of these gaps have been faded…while most gaps to the downside have been
bought. We have no clue how today finishes but a strong day will break most
important indices above resistance for the first time since the top.
That takes us to the BOND MARKET. The BOND MARKET is giving the FED plenty of
reasons not only to stop raising rates…but TO CUT RATES. We said TO CUT RATES.
FED FUNDS are at 5.25% with the 30 year now under 5%. Normally, FED FUNDS would
be at 4%…maybe 4.25% with the 30 year just below 5%. We hope the FED is
listening to what the market is saying.
We will have a complete update on Monday.
Gary Kaltbaum