For eighteen straight trading days, the Dow Industrials have traded at 10,500. Looking at the chart, it appears that we have a flat line Dow for almost a month. That could be the most exciting thing about today's trading.
There was a big rally in the morning and then stocks drifted down the rest of the day. I call this a distribution technique, push prices up fast ensuring a good bit of chasing to get in and then some buyers under the market to sell to over the course of the day. The market is just taking more and more captives as it meanders through treacherous water. Yes, many stocks have moved up a bit into this past few weeks highs but many have not.
We are still perplexed by the overwhelming bullishness in the market place. We believe that bullishness is misguided and will be reversed over the course of the next four months. You might say, "What can push this market down?" to which I reply what ever does. Today oil was up about $2 to over $55 and the bulls are now impervious to higher oil prices, they just don't matter to anyone. Anyone, that is, except companies like Northwest Airlines, NWAC, who need to pay for fuel and can't raise prices to cover their expenses. NWAC is thought to need a possible Chapter 11 to seek protection from creditors.
The precious metals were not very strong today with gold up a little and silver down a little. The mining stocks faired ok with PAAS a little weak. PAAS needs to run up strongly here in the next few days to we can feel more confident in our bullish position in these stocks. We continue to recommend these stocks and the precious metals themselves.
Dow Industrials: 10522.56 +9.93 (Is anyone else getting bored with this 10,500?)
BGEIX: 10.80
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1 comment:
how come you didn't tell us to go long BBY?
nwac's execs are giving themselves raises while cutting other employees' pay. fuel is just an excuse. poor route scheduling
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