Major Market Indexes Finish With Slight Gains; Options Expiration Skews Volume Figures.

Happy St. Patrick's Day!!

Stocks finished the week with small gains, with the Nasdaq up .3%, SP 600 up .3%, SP 400 up .3%, Dow Jones up .2%, and the SP 500 up .1%. It was a good week for stocks, overall, with most indexes up around 2% for the week.

Volume was much higher today but you can't call it an accumulation day because the indexes were not up .5% and it was quadruple witching Friday. Quadruple witching is a day on which contracts for stock index futures, stock index options, stock options, and single stock futures all expire. The high volume is caused by all option players being forced to exercise options on the last day their contract is worth anything. They can either roll it over, have it expire worthless, or exercise the contract. Back when I was trading options I usually was out of positions well before this day. Time decay is one of the most important things to understand when trading options. Obviously, a lot of traders don't understand it.

NYSE advancers beat decliners by a 6 to 5 margin and the Nasdaq had 8 advancing for every 7 declining.

Computer-Hardware, Biotech, Investment Brokerage, REITs, and Airlines did well today and the Semiconductor sector found some bids today. With technology stocks bouncing it could help attract speculative money to go along with the boring (REIT, Big-Caps) money. Even if the speculative money doesn't come in the action in the old Big-Caps is good enough for me. They have been doing very well, even during the pullback and old leaders Copper and Steel are showing some leadership too.

So everyone can keep worrying about the Semiconductors and the Nasdaq. I will be paying attention to the NYSE and watching the Nasdaq for signs of life. The Nasdaq still looks like it could take a while to get going. A rotation of tech leaders into new tech leaders can take some time. The heavy volume might not be churning--though technically it looks very much like it is--and could be the high volume needed to rotate into new leaders. They both look the same in the middle or near the end runs of a bull market. Like I said yesterday though, take a look at all the four letter words that I am still long. Obviously, the Nasdaq isn't as weak as the "professionals" say it is.

The market is still very emotionally draining. Therefore, it is very important to stay disciplined, have a plan, and execute on it. Ignore the CNBC and CNN and pay attention to your charts.

An interesting note is in today's 'Big Picture' in IBD: Please read it on your own.

I will summarize it by saying after the crash in 1929 (2000) we finally bottomed in 1932 (March 2003). We then rallied for a whole year from 1932-1933 (March. 03 to Jan. 04) and then went sideways for two years 1933-1935 (Jan 04-Nov 05 to now). That then led to the two year rally into year 1937 (now to 2008) where the Dow Jones was up 94%. Friday was the three year anniversary of the beginning of the March 2003 rally. I wonder if history will repeat itself. Then and now, doom and gloom was thick in the air!

Another possibility is the end of rate hikes. The last time rates were hiked this much and then stopped was in 1995. If you go back and look at the rate hike cycle and the performance of the stock market you will see we are matching pretty closely (not exactly, but closely). As you can also see when rate hikes ended at the beginning of 1995 stocks made one of the biggest rallies in the history of the stock market. I doubt that will happen this time. But something to remember. HISTORY REPEATS ITSELF OFTEN. You never know if it could again.

But I thought with all this doom and gloom talk being placed on us by the biased liberal media that these scenarios could bring comfort to shaky investors.

We shall see what Monday brings. Have a great weekend and I should have the reasons behind all the longs posted on Investors Paradise by the end of Saturday night.


New Swing Longs: LPSN RMBS KNDL BWLD FMTI COMS WST WGRD

Adding To Current Long: MT

New Swing Shorts: NONE

Longs Outperforming Market: ATHR-98% KNXA-48% ERS-143% SEAB RATE-144% CHE CLZR-40% UIC-38% FFIV RAIL-71% CYBS BOOM-395% CTXS-37% IVAC MTU MDCC-40% NTAP TMI MFLX-218% SLW-106% ROK RUTH PETS-162% LCRD-88% ASVI CRDN-50% TRAD-46% NVDA-62% KEX-26% SCVL CIB-42% STRL SLAB HEIA-31% ASF-208% BBD-146% FRGB STX XRTX-32% SAY-32% KDN BGC-55% IHS-27% CBG-100% SCHK-35% AAU PEC MEK-43% SSW ALTU FWLT-66% IIP AKN GNBT-100% SBAC-45% MDII ECIL MT GEMS AKS LMIA-90% ASGN-80% BWNG-100% RNT NTO-35% VRTX-204% DRH CKR VTSS JDSU-68% ECOL ARBA LSI CDE MNST-48% RSTI-31% BE NENG-38% CONR RIMM RBAK-172% GNA CVO-81% AXE NVAX-62% AIX PWR A BEAV-39% HPOL SF SMF

Shorts Outperforming Market: NONE

Stocks On Radar Screen: WXS AIS TXCC HET ABMD HBE ERICY