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.

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-- Jack Krupansky