Stocks End The Day Mixed But Flat From Friday, After A Wild And Volatile Session.

January 29, 2007

Stocks ended mixed, after a wild day of trading, as traders positioned themselves ahead of the Fed meeting. To me, it just showed that the bulls and bears are both being very stubborn here and are evenly matched.

At the close, the SP 600 was up .4%, the Nassy finished up .2%, the DJIA ticked higher by .03%, and the SP 500 diverged closing with a .1% loss. The IBD 100 finished up .4%, keeping pace with the SP 600.

Volume was lower on the Nasdaq and higher on the NYSE. The higher volume on the NYSE does not make today a distribution day because the index was not down .2%.

Breadth was positive on the NYSE by a 9-to-7 margin and positive on the Nassy by a 3-to-2 margin.

Overall, it was a pretty much random intraday of meaningless action. However, many leading stocks bounced off recent support and/or continued to make new highs today. All of this very positive action in leading stocks (HMIN USAP STLD ATRS KNOT VPRT DLLR FMCN) when the market basically goes nowhere is very positive for a short-term rally.

Does it mean it will happen? No. A reversal would be very ugly here. But the odds of further gains are much higher, with all of this positive action underneath the big-caps.

The put/call ratio jumped to .92 intraday, showing that there is still plenty of fear out there about being long this market. Fear is just what stocks need to climb that ever-famous wall-of-worry. As long as people are placing bets for a decline, the market will probably disappoint them.

Tomorrow and Wednesday will, more than likely, be more exciting than today. Or maybe it will not be and the fireworks will start after the Fed meeting. Either way, I think readers of my site are well prepared no matter what happens.

The current rate is at 5.25% and has been that way for four meetings after a 17 month binge by the Fed. Most people expect them to stay at this level. I would LOVE to see them drop them a quarter basis point to 5%. Maybe that is wishful thinking, but according to numbers coming out over the past two months I think it would be a good idea. It may even be more wishful after all the strong economic reports the past couple of weeks. But still the intermediate trend is slowing.

I hope everyone had a better day than me. I was blind all day as a major cable interuption made it impossible to work or be online because I had to wait for the internet specialist. What was my arrival time??? Anywhere, between, 8am-430pm. They arrived at 2pm. But still it was a wasted day.

Aloha and I will see you in the Chat Room.

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