Three Things I Like About This Market
January was down. Oh my gosh!
That means the market will be down this year.
Too many bulls. The market will be down this year. First year of an election.
The market is going to be down this year. Wait a minute. January was down but
there were plenty of times the market was up when that occurred. Too many
bulls There have been too many bulls since the low in 2003. First year of an
election. How about this is a year ending in 5? That’s always supposed to be a
good sign for a good year. Well…now you know why Prozac sells so well.
I continue to be amazed by all the nonsense that is spewed on a daily basis
about the markets. Maybe, just maybe, January being a down month means
something, but let me be clear…IF THERE IS ANYONE WHO THINKS THAT IN
OCTOBER, THE MARKET WILL REMEMBER WHAT HAPPENED IN JANUARY…you can fill in
the blank.
I told you last week that I was going to look for a follow-through day
starting yesterday. Sorry…price was great but volume was a joke. The good
news is that after a pretty gross few weeks, the “market” is finally putting
up a fight. I like:
   -that the Small caps are starting to lead again. In fact, the Small cap 600 is
the first index to move back above the 50-day average.
   -that the NEW HIGH LIST is strong even though the market still lags.
   -that breakouts have started to follow-through on their moves.
That said, there is repairing to do before the market can really turn up. My
best guess is that shorter-term, the bias has turned better, but to now expect
a split tape. I am simply seeing too many poor looking charts to get too
excited just yet. Lastly, regardless of all the noise, if sellers start to
show up again and last week’s lows are taken out, expect another good leg
down.
Gary Kaltbaum