« Support Breaks Abound | Main | Notable Stock Charts »
October 07, 2005
Random Rants
***Overview***
Thursday was the third day in a row of Fed anti-inflation jawboning.
There is now talk that the "much awaited" year-end rally may never come. One thing is for sure, a year-end rally will start with some kind of reversal and bullish catalyst. Yes, the market will ring some sort of bell when and if it wants to rally.
The Wall Street Journal reports that high energy prices are starting to eat into demand and this has put downward pressure on enegy prices. It is classic economics and the supply/demand curve.
Thursday was a big day for retailers as Wal-mart, Starbucks, Abercrombie & Fitch and Pacific Sunwear all reported good sales numbers. However, Talbots, Federated and Petsmart reported weak numbers.
Did you see that spike higher just before the close? That was probably shorts taking profits ahead of today's non-farm payroll report.
"The market has to rally significantly from here," or stocks will continue to decline, said Bill Strazzullo. You don’t say.
Jim Jubak of MSN reports that Wal-Mart is going to target higher-income shoppers and go after Target. This will include store upgrades. Personally, I do not find Wal-Mart a pleaseant shopping experience.
The Euro Index declined to support from its early July low and gapped up yesterday. Similarly, the US Dollar Index hit resistance and fell sharply
***Indices, Sectors and Industry Groups***
The Dow Transports held above its September low and the fall in oil prices may be putting a bid into these stocks.
The Dow Utilities suffered its largest three day decline since Nov-02.
The Nasdaq closed below key support at 2100.
However, the Nasdaq 100 is holding key support at 1550.
The NYSE Composite is testing key support from its August low.
The Consumer Discretionary SPDR (XLY) formed a doji near its September low and this shows indecision that could foreshadow a bounce.
The Finance SPDR (XLF) managed to firm at support.
The Retail HOLDRS (RTH) is firming, but can it clear 94 for at least a trendline breakout.
The Software HOLDRS (SWH) broke triangle support at 35.2.
The Transportation ETF (IYT) rose on good volume.
***Stocks***
IGT survived the three day carnage pretty well.
JBNT gained on good volume yesterday and sports a falling wedge over the last seven months.
JWN has consolidated the last three months with downside volume outpacing upside volume.
DG surged on good volume.
--------------------------------------------------------
Posted by Arthur B. Hill at October 7, 2005 12:18 PM