Bear Mountain Bull

It’s time again for a little BMB R&R, especially with the market behaving as bizarrely as it’s been. Maybe if we stop watching it start to behave a little better…

Posting will be very light and variable over the course of this week, but we’ll put up an open thread each market day for our readers to comment on the day’s market activity or to post any interesting links they might run across.

Check the space below for whatever the latest might be during this ‘off’ time, and please visit the various sites in the ‘Links’ and ‘Regular Stops’ for up-to-date market news and analysis.

BMB will be back in full swing by next weekend.

This article on cash was linked to earlier in the day by a BMB reader.

Sometimes, being in cash is the best way to go. This may very well be one of those times. At least we’ve seen interest rates on money markets and savings accounts perk up a bit. The least Uncle Al can do for us is get short-term rates up near the real rate of inflation. That way we can at least tread water while the stock market is behaving badly, which might be a while.

The market didn’t do much to change anyone’s opinion in either direction today, wandering around slightly above the unchanged level most of the day and gaining ground in the last hour of trading. The Dow Industrials gained 59 points (+0.6%) to 10252, the S&P 500 moved 5 points higher (+0.5%) to 1162 and the Nasdaq added 7 points (+0.4%) to 1929. The Russell 2000 gained 6 points (+1.1%) to 586, the Dow Transports gained 1.7%, the Utilities gained 0.5% and bonds held their ground today, with the yield on the 10-year Treasury at 4.19%.

Market internals finished the day on the positive side, but volume was light. Advances led declines by 21 to 11 on the NYSE and 8 to 7 on the Nasdaq. Up/down volume was 2 to 1 on the NYSE and 9 to 7 on the Nasdaq. New highs/lows were 69/51 on the NYSE and 29/140 on the Nasdaq.

Leading the way higher today were oil services (+2.8%), natural gas stocks (+1.6%), computer hardware (+1.5%), oil stocks (+1.4%), transports (+1.2%), commodities (+1.2%), biotechs (+1.1%) and chemicals (+1.0%). Losing groups on the day were the broker/dealers (-1.9%) and paper stocks (-1.1%).

Crude oil prices rose $1.20 on an afternoon rally, finishing at $50.92/barrel. The dollar index was mostly unchanged, but gold prices fell to near $430/ounce.

The Fed’s decision on interest rates is tomorrow - of course, everyone already knows that they will raise the Fed funds rate by 1/4 point. And I can pretty much bet that they’ll keep the ‘measured’ language too. Nothing will change. That’s my take.

Gary Kaltbaum picks apart the current condition of the market, and says he sees that the market has a chance for some upside testing here. But don’t get your hopes up - it’s only a chance, and he doesn’t see much reason just yet to get excited about the market’s longer-term prospects.

The current state of market technicals and sentiment from Schaeffer’s. Indications are that the market probably hasn’t yet reached a ‘tradable bottom’ just yet, but some signs are hinting that we may be close.