Stock Market Commentary for Thursday, March 3, 2005

The modest 3.75-point Nasdaq decline on Wednesday was due to a combination of profit-taking after Tuesday's rally, and a little anxiety while people wanted for Greenspan to testify before Congress and some more anxiety while people are waiting for the "big" employment report on Friday. No big deal.

The good new is that despite the decline, Nasdaq actually closed modestly above its opening level (by 7 points) and moderately above its intra-day low (by 10 points). Those are good signs. Traders and short-term speculators made a diligent effort to push the market down, but it bounced back.

The bad news is that Nasdaq closed 17 points below it's intra-day peak. That's a moderate yellow flag, but probably not so bad since it may have been simply caused by nervous short-covering after the initial strong bounce after the morning low.

Nasdaq trading volume was heavy (2.03 billion shares), and breadth was moderately negative, with 1.29 losers for each gainer. We're in a rip-tide trading market again, with the two warring camps almost equally balanced between those pushing for people to get out of the market and those believing on getting deeper into the market. I lean a little towards the latter camp.

Click here to read the entire column.