Stock Market Commentary for Saturday, June 4, 2005

Finally, we had a decent profit-taking session on Friday, with Nasdaq suffering a sharp 26.37-point decline.  It had to happen eventually and it always does.  This does not signal the end of the current up-leg, but is simply a chance for the market to "digest" a little of the recent gains.  The nominal "catalyst" for the decline was the weak employment report, but anybody with any sense (and I'm sure there are at least one or two besides me) knows not to pay too much attention to volatility in these numbers.  Last month was a great month and this month was a mediocre month and they average out to a fairly decent number.  Enough said.

The market opened with some negative sentiment and there simply wasn't enough buying pressure to cause traders and short-term speculators to do anything other than to take a bearish stance, and in the face of such a stance, short-term momentum speculators "headed for the exits."  This happens sometimes, but doesn't give us a clue as to the future trend.

The economic data continues to be mixed and so-so.  There's been no significant change over the past week or month.

Nasdaq trading volume was light (1.68 billion shares), and breadth was moderately negative, with 1.73 losers for each gainer.  This was not a heavy sell-off, despite the sharp point decline.

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-- Jack Krupansky