Sunday, August 14, 2005

Suspension of my blogging until further notice

[Note: My daily stock market column will continue to be updated on the website.]

Thursday, August 18, 2005 is the six-month anniversary of my foray into the blogosphere.  It's been a lot of fun, but it simply hasn't shown any evidence of giving me a significant enough return to justify the level of investment of my time required.  So, after careful thought, I've decided to go on an indefinite hiatus from the blogosphere, possibly a year or longer. My blogs will remain up with all of my past posts, but I won't be making any new blog posts.  Further, I won't be monitoring or commenting on the blogs of others.  However, I will continue to receive any comments on my old blog posts and may be contacted directly via email.  New content will appear on my main, non-blog web sites, hopefully with greater frequency now that I won't be distracted by the blogosphere.

I thank those who have taken the time to read and even comment on my blog posts over the past six     months.

I may check back in six months to see if there are any truly startling new developments in the blogosphere, and in a year or so I will definitely check back again.

I may or may not make a few more scattered posts before midnight, Thursday, August 18, 2005 when I "officially" leave the blogosphere.

Again, my thanks to those who have participated in many interactions over the past six months.

Friday, August 12, 2005

Stock Market Commentary for Saturday, August 13, 2005

Dell (DELL) and oil prices were blamed for the market decline on Friday, but I remain as skeptical as ever about such "reasons."  Rather, I believe that the market has been in a correction, and it is simply a continuation of that negative tone that led to a continuation of the selling.  NASDAQ fell a moderately sharp 17.65 points.

The good news is that NASDAQ bounced 12 points off its intra-day low, suggesting that maybe the point of "selling exhaustion" has finally been reached for the current correction, and that maybe people are once again in a more positive "buy on the dip" mood.

The disappointment over Cisco (CSCO) and Dell (DELL) was more of a short-term "buy the rumor and sell on the news" reaction than a reflection of long-term business fundamentals.  Business performance will be erratic over the next few years, but nonetheless will likely advance on a modest upward trend.

The economic data was mixed, but with a bit of a negative tone.

NASDAQ trading volume was very light (1.66 billion shares), and breadth was moderately negative, with 1.77 losers for each gainer.  This was not a heavy sell-off.

Thursday, August 11, 2005

Stock Market Commentary for Friday, August 12, 2005

The market rise on Thursday was just the kind of dead-cat bounce short-covering rally that should be expected after (or during) a correction.  NASDAQ rose a moderately sharp 16.74 points, but barely recovered the loss from Wednesday.

People can't seem to make up their minds whether high oil prices are a big deal or not.

The economic data continues to be mixed.

We didn't have a net inflows into domestic equity mutual funds last week, which is not a good sign, but could simply be a fluctuation rather than a true trend reversal.

NASDAQ trading volume was very light (1.62 billion shares), and breadth was moderately positive, with 1.75 gainers for each loser.  This was not a strong rally.

Wednesday, August 10, 2005

Stock Market Commentary for Thursday, August 11, 2005

Once again, the chatterers blamed high oil prices for the market decline on Wednesday, but it was simply a continuation of the recent correction after a brief dead-cat bounce on Tuesday.  There was an early rally, but the overall market tone is still to "sell into any rally".  I'd rather see a day where the market starts out with a very negative tone and heads down to "selling exhaustion", and then we'll get an end to the correction.

The current correction continues to be strictly technical in nature, not the result of economic or business fundamentals.

There was some chatter about Cisco (CSCO) giving a revenue growth forecast a little less strong than expected, but that's more of a speculator's reaction than an investor's reaction.  Cisco is doing fine, albeit not as well as before the boom busted.

NASDAQ trading volume was moderate (1.88 billion shares), and breadth was moderately negative, with 1.26 losers for each gainer.  This was finally a moderate sell-off, but still not a heavy sell-off.

Tuesday, August 09, 2005

Stock Market Commentary for Wednesday, August 10, 2005

The moderate NASDAQ gain of 9.80 points on Tuesday was most likely a classic dead-cat bounce after a couple of days of correction.  The Fed acted as expected, so there was little or no catalyst there.  Most likely, this was simply a classic dead-cat bounce after the recent correction.

The economic data remains mixed, but is still mostly from June anyway.

NASDAQ trading volume was very light (1.49 billion shares), and breadth was modestly positive, with 1.10 gainers for each loser.  Trading volume is way too mediocre for this rally to mean much.

Monday, August 08, 2005

Stock Market Commentary for Tuesday, August 9, 2005

Despite the chatter about oil prices, the moderate decline market decline on Monday was simply a continuation of profit-taking due to a lack of positive momentum and people on Fed Watch ahead of the FOMC meeting.

There was actually a little optimism at the open, but people sold into that rally.  Until we see either "selling exhaustion" or some significant upwards momentum, short-term speculators will maintain a negative tone.

The bad news is that NASDAQ did break below the intra-day low for the up-leg that started on July 25, suggesting that we are in fact in a true correction and not simply a random fluctuation.  Whether this suggestion is true or not remains to be seen.

NASDAQ trading volume was very light (1.50 billion shares), and breadth was moderately negative, with 1.50 losers for each gainer.  This was not a heavy sell-off.

Sunday, August 07, 2005

Stock Market Commentary for Monday, August 8, 2005

[Some minor changes in the actual column since Saturday]

Despite a relatively decent monthly employment report, we had a continuation of the latest bout of profit-taking on Friday, with NASDAQ losing a moderate 13.41 points.  The continuation of the sell-off was disappointing, but it's not uncommon for sell-offs to run further than logic might suggest since momentum traders like to push things as far as they can, and buyers would like to see the selling wash out before they jump back in.

There was chattering that the solid employment report was "fueling interest rate worries", but the simple fact is that the employment was not that good.  Unemployment actually rose, which is hardly a sign of an overheating economy.

NASDAQ trading volume was very light (1.52 billion shares), and breadth was strongly negative, with 2.07 losers for each gainer.  This was not a heavy sell-off.

Saturday, August 06, 2005

Gasoline price update for Boulder, Colorado

I wrote in my column yesterday that gasoline prices were stable here in Boulder, Colorado except for one station rising by a penny on Thursday, but boy did I speak too soon.  Walking home last night, one station that had been stable for a week jumped by four cents.  The station that had risen by a penny jumped another seven cents, and another station that had been stable for a week jumped by eight cents.  I don't recall ever seeing such a sharp spike, especially since crude prices hadn't risen that much.

Maybe the retailers figured this was their last big shot to capture some extra profits before the Summer vacation driving season winds down.

Friday, August 05, 2005

Stock Market Commentary for Saturday, August 6, 2005

Despite a relatively decent monthly employment report, we had a continuation of the latest bout of profit-taking on Friday, with NASDAQ losing a moderate 13.41 points.  The continuation of the sell-off was disappointing, but it's not uncommon for sell-offs to run further than logic might suggest since momentum traders like to push things as far as they can, and buyers would like to see the selling wash out before they jump back in.

There was chattering that the solid employment report was "fueling interest rate worries", but the simple fact is that the employment was not that good.  Unemployment actually rose, which is hardly a sign of an overheating economy.

NASDAQ trading volume was very light (1.52 billion shares), and breadth was strongly negative, with 2.07 losers for each gainer.  This was not a heavy sell-off.

Thursday, August 04, 2005

Stock Market Commentary for Friday, August 5, 2005

Despite the chattering about "reasons", the market decline on Thursday was simply the kind of old-fashioned profit-taking that we tend to see after an extended upwards move has run out of steam.  Short-term momentum speculators pile on on the way up but bail out when momentum looks at risk of reversing.  At that point they reverse and bet on the decline, exaggerating the sharpness of the decline.  NASDAQ lost a sharp 25.49 points.

There was a lot of chatter about lousy retail sales, but that was just for a few stores.  I expect that the monthly report, due out next Thursday, will be much better.

I suspect that there may have been some people who were worried that the monthly employment would be weak.

NASDAQ trading volume was very light (1.65 billion shares), and breadth was very strongly negative, with 2.30 losers for each gainer.  This would have been a heavy sell-off, but trading volume was much too weak and the point decline wasn't much more than 1%.  Such volatility is not uncommon when trading volume is light.

Wednesday, August 03, 2005

Stock Market Commentary for Thursday, August 4, 2005

NASDAQ experienced only a tiny bit of profit-taking on Wednesday after its recent rallying, falling a slight 1.34 points.  That's actually a fairly good sign.

The economic data was somewhat mixed.  No new news there.

NASDAQ trading volume was moderate (1.83 billion shares), and breadth was moderately negative, with 1.41 losers for each gainer.

Tuesday, August 02, 2005

Stock Market Commentary for Wednesday, August 3, 2005

Some decent economic data helped to provide a catalyst for a halfway-decent rally on Tuesday.  NASDAQ rose a sharp 22.77 points (+1.04%), setting yet another high for the current advance and for 2005, and finally breaking through the psychological 2,200 level on a closing basis for the first time since June 8, 2001.

NASDAQ trading volume was moderate (1.79 billion shares), and breadth was moderately positive, with 1.55 gainers for each loser.  Despite the nice point-gain, this was not a strong rally due to mediocre trading volume and relatively weak breadth.  Once again, this looks a little like a rotation from smaller-cap stocks to larger-cap stocks.

Monday, August 01, 2005

Stock Market Commentary for Tuesday, August 2, 2005

Some anxiety over the death of Saudi King Fahd weighed on the market on Monday, despite a decent ISM Manufacturing report.  NASDAQ continued its slow upwards march, rising a moderate 10.55 points, not setting a new closing high, but setting a new intra-day peak of 2,201.87 for the year and for the advance off the October 2002 low.

The economic data was mixed, as usual.  No new news there.

NASDAQ trading volume was very light (1.51 billion shares), and breadth was modestly positive, with 1.24 gainers for each loser.  Don't pay too much attention to market movement on a day with such low volume.  The weakness of breadth was a little disappointing, and may signal a rotation from smaller-cap stocks to larger-cap stocks.