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.

…all over again.

BMB has been saying that it seems like we might be going through a period similar to the what we saw during the month of February, which connected the January and March spike lows.

Chart Swing Trader has a couple of charts today that support that view, at least for now.

Are we seeing a bottom in the dollar? We’ll find out in time - but I’ll bet they were calling a bottom in the dollar back in ‘06 too. Looks kinda familiar, doesn’t it?

Chart courtesy of StockCharts.com

We’ve been thinking that getting too bullish here might be premature…

I didn’t watch the market real closely today, being busy with a few other things, but I did see enough to know that things started out weak, got some strength back around lunchtime, and then fell apart in the afternoon.

Only the Nasdaq indices held their losses under 1 percent:

Treasuries were higher, pushing yields down:
6-month: 1.90%    2-yr: 2.42%    5-yr: 3.14%    10-yr: 3.91%    30-yr: 4.55%.

Internals were negative, and volume picked up slightly - not a real encouraging sign. Advances/declines were 3 to 11 on the NYSE and 11 to 21 on the Nasdaq, with up/down volume 1 to 4 on the NYSE and 7 to 13 on the Nasdaq. Of course, there were more new lows than highs: highs/lows were 19/67 on the NYSE and 33/66 on the Nasdaq.

Only the semiconductors (+1.5%) managed to finish green, while the losers were led by the financials: banks (-5.0%), brokers (-4.5%), biotechs (-3.4%), airlines (-3.4%), paper (-3.0%), REITs (-2.9%), natural gas stocks (-2.2%), retail (-2.1%), oil stocks (-1.9%) and networkers (-1.8%).

Energy prices were mixed again. Crude gained a buck-and-a-half to $120.02/barrel and gasoline added a nickel to $3.00/gallon, but natural gas slipped back to $8.57/mmBTU. The dollar index finally moved to its highest levels in months at 74.51 as the Euro comes under pressure. Gold fell just six bucks to $873/ounce but silver got hit harder, knocked back to $16.18/ounce.

BMB Note:   As we’ve said, the chop continues.

Not much to say at this point, except that things still look pretty dicey, with the indices really unable to make up their mind as they bounce around day after day, with just a slight drift higher. Generally, these sorts of moves don’t last, but it’s too early to call the ‘rally’ over and done with yet.

So we wait, and watch from the sidelines until one team or the other gets a decided advantage.

Which is it - are the numbers up or down?

Depends upon how you look at it. The numbers are up from May, but with the typical seasonality of the housing industry, the YOY comparisons are more telling, and in that respect, pending home sales were down more than 12% from last June:

The Pending Home Sales Index, a forward-looking indicator based on contracts signed in June, rose 5.3 percent to 89.0 from a downwardly revised reading of 84.5 in May, but remains 12.3 percent below June 2007 when it stood at 101.4.

Barry takes the media to task for getting it wrong - always. We’re not surprised.

A weak open today on the heels of some lousy earnings reports and rather weak retail numbers rolling in, but the selling hasn’t gained much momentum. The indices have already come up off their early lows, but A/D lines remain pretty well in the red for now. Leading the decline are the airlines, metals, paper, steel, brokers, retail and transportation. Only the semiconductors have managed to put up decent green numbers.

Treasuries are higher, yields lower. Energy prices are slightly higher. The dollar index is still trying to push higher, but is testing resistance. Gold and silver are lower.