Tuesday Noon

Huummm......Back to the drawing boards.  There must be some magic in that 'ole Mr Market after all!.  Dow and the SPX are up this morning, as are most major indexes.. except the Transports which are down 20 points.  Oil is strong this morning, up 1.26 at 90.51.  The Alaska Pipeline, carrying 11% of US crude production, has been shut down and the operator, Alyeska Pipelilne, has no estimate when operations can re-open.  In addition, there are reports of a major fire at a Canadian Oil Shale facility that produces another 4% of crude delivered to the US daily.  The only wonder is that oil is not trading at $100 pb.  Oh wait.. it has only been 3 days.

The commodity complex is up across the board, with Gold up 3.50 at 1377.6 and Silver up .65 at 29.52.  The Euro is up slightly at 1.297, while the dollar is off a few ticks at 80.96  Debt markets are weak, with the Note at 3.35% and long Bond at 4.52%

Our concern about a pending Momentum Change in the big equities indexes has been postponed again, as todays rally has removed some of the pressure.  The beginning of 4th quarter earnings reports has begun, and good results generally being the norm.

But concerns remain.  With the Dow and the SPX posting new rally highs, we continue to see major divergences.  With the new highs in the indexes, you would think that most stocks are participating.  But the 5 day summary of US Stocks making new highs, less those making new lows continues to show us that since early November, fewer and fewer stocks are participating in this rally.

So if it seems as if your portfolio is not doing as well as the indexes, here is the proof. We have been saying since April 26, investors long term capital should be parked in a safe liquid place, and only the most nimble trading should be in this market.

Best to Your Trading!

Bill