Market Commentary for Thursday, February 24, 2005

Wednesday was a classic in-between trading session as people were very undecided as to whether to continue betting on a decline, simply take some profits, or make an outright bet on a bounce. Nasdaq closed near flat, rising only 0.93 points, and on significant volatility. In fact, Nasdaq closed 8 points below its opening level, over 9 points below it's intra-day peak, and 7 points above its intra-day low. People sold into any attempts to rally, but they bought on the dips as well. They did everything but act decisively.

The fact that Nasdaq closed up but well below its opening level is a moderate yellow flag. In other words, we're not out of the woods yet.

The economic data was reasonably positive, but nothing toe get excited about, either way.

Nasdaq trading volume was barely moderate (1.77 billion shares), and breadth was modestly positive, with 1.13 losers for each gainer. This was a "treading water" session, with people playing both sides of the market, with no convincing momentum in either direction.

Click here to view the entire column.