I can’t sum up today’s action any better than today’s Worden report, so here it is:
Who’s Trying to Fool Whom?Uday and Qusay Hussein were killed. I don’t know if that is worth much to the market, but it clearly lent some fireworks to today’s action. This happened in a spot where the market could decide to stage another leg up. The SP-500 came down and touched the 50-day moving average. As a dyed-in-the-wool contrarian, I feel a little uncomfortable about how widely this was recognized. It was announced on CNBC by a pretty red-headed girl. She didn’t mention that MoneyStream is in its second leg down, but then, I’m sure she never heard of MoneyStream.
In the Nasdaq, MoneyStream has never violated its uptrend, and on a very short-term basis TSV is positively divergent. Volume was up a bit on today’s rise.
The market does look a little better here, and I’m not going to argue about it. As I said yesterday, “This is not a pernicious decline. Individual stocks seem to be the masters of their fates. The ones that deserve to go up do go up.”
Time and time again, I’ve seen the market change its colors under the cover of a seemingly irrelevant event. Maybe today’s events in Iraq provoked a not very lasting reflexive response. But its obvious temporal quality does provide a pretty good cover story if you’re trying to fool somebody. And the market is always trying to fool somebody. -DW
