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.

From The Big Picture:

Peter Boockvar notes:

Today’s consolidated volume for NYSE names was a low for the year to date.

Helene Meisler notes:

It’s a bear market — and these low volume rallies are typical of short covering. (unless you believe all those dark pools are swallowing all the volume!).

As long as there are shorts in the market we will get rallies;  Once the shorts cover we get a decline like last week.

Doug Kass goes even further:

I am starting to scale into shorts now. 
My favorite? PowerShares QQQ (QQQQ). 
My catalysts? The VIX and volume.

That’s our surprising data point of the day.

Meaningful or not? You decide.

Today’s new high list held a rather diverse mix:

Charts courtesy of StockCharts.com

A fairly positive day for stocks, enabling the major indices to grab back some of last week’s decline, but volume as it was on Friday - was lacking.

Big gains from RIMM helped the Naz-100 lead the way, but the Russell was close behind:

Treasuries fell at the short end and pushed yields up there, but changes were less noticeable further out:
6-month: 1.87%    2-yr: 2.30%    5-yr: 3.01%    10-yr: 3.79%    30-yr: 4.53%.

Internals shifted back over to the positive side. Volume was a tad heavier on the Nasdaq and lighter on the NYSE, but still fairly light overall. Advances/declines were 7 to 3 on the NYSE and 11 to 5 on the Nasdaq, with up/down volume 3 to 1 on the NYSE and 4 to 1 on the Nasdaq. The Nasdaq new high/low quandary remains: on a day when the Nasdaq Comp. was up 1.76% and the Naz-100 up 1.87%, there were still only 44 new highs and 68 new lows. On the NYSE, there were 52 new highs to 23 new lows.

In the groups, the green list was fairly long, but was led mostly by last week’s laggards: retail (+2.7%), brokers (+2.5%), REITs (+2.5%), transportation (+2.1%), internets (+2.1%), banks (+2.0%), housing (+1.7%), airlines (+1.7%) and networking (+1.7%). Oil services (-1.4%) led a short list of losers.

Energy prices finally relaxed slightly. Crude oil slipped to $124.23/barrel, gasoline dropped three cents to $3.16/gallon, and natural gas fell to $11.30/mmBTU. The dollar index dropped back below 73 to 72.94. Gold lost a few bucks to $882/ounce but silver had a solid day, pullling back from its highs to finish at $17.12/ounce.

BMB Note:   Not too many comments today. I don’t have a strong opinion on this market, one way or the other. Obviously, there are some strong leading stocks, but the ’strength’ of the overall market remains in question. The indices remain at a fairly indecisive point, with the move up off the lows having stalled a bit here and facing resistance overhead, yet are resisting a move lower. No way to know how this gets resolved yet.

The commodity stocks have paused, and there aren’t that many other names that are continuing to move higher - but they are out there. As for today’s action, it was led mostly by those groups that were looking shaky last week, so I don’t know if that’s good or bad.

And the Nasdaq highs-minus-lows just continues to sink, even as the indices edge higher, just making clear the narrowness of the move:

So either breadth widens out and we can move higher, or eventually the move fails. Invest accordingly.

After a shaky start, a morning mini-ramp has taken the indices a little higher in the last half-hour. A/D lines have joined the indices in green territory. The groups are mostly green, but only a few solid winners at this point, those being last week’s weaklings: paper, banks and retail, along with the networkers. The oil services are leading a short list of losers.

In Treasuries, yields are higher at the short end, but a bit lower further out. Energy prices are fairly flat. The dollar index has fallen back down after a bump up overnight. Gold is near flat, silver is higher.