An early morning gap was soon sold after the new-home sales came in worse than expected. But that was soon absorbed and the indexes spent the rest of the day flopping around to the upside, finishing the day in positive territory.
At the close the SP 500 led with a .2% gain, the Dow Jones Industrial Average and the Nasdaq gained .1%, and the SP 600 fell .2%.
Volume was higher on the NYSE and lower on the Nasdaq. Volume was also, once again, much lower than average. There is another six days of this so be prepared. Breadth was basically flat, with advancers and decliners running a stalemate.
Today was another classic late August snooze-fest. There really isn't anything that happened today that changed the technical picture. A few things underneath have raised caution flags with me. A lot of my individual longs from pretty chart patterns have started faltering and some have broken down. If this market was really ready to get moving, I would not be seeing this happen. That along with the IBD 100 lagging again today (-.4%) just keeps reinforcing the notion that this rally is not "the rally."
The other fact is that this rally is happening on extremely low volume. If we would be pulling back right now on lower volume during the quiet August time, I would be TEN TIMES more bullish. That would setup some beautiful chart patterns. Instead we are ticking up on lower volume, setting us up for a possible reversal on heavier volume when Wall Street gets back to work. I hope I am wrong but history shows that low volume August rallies lead to high volume September selloffs.
Whatever happens really shouldn't matter right now, since everyone has been listening to me since May 11th and has been around 75% to 100% cash. Right? No? You couldn't stop trading? I couldn't either. LOL. However, the positions have all been small and not much has changed since then. The cash has probably kept you safe from forcing to make a decision about being a bull or a bear. A play that has proven silly the past few months.
Right now the market has no real trend and the best bet is to stay patient and keep your cash levels high for that prime moment to strike. This market is going to stay dead and boring for another six days. So stay awake and if you must take a vacation NOW is the time to do it. There is simply not going to be a more quiet week this year than the week that we are about ready to run into.
Great luck out there and I will see you at Investors Paradise.
New Swing Longs: EMS SVNT AHS AMRN
New Swing Shorts: NONE
Longs Outperforming (low vol. non-IBD excluded): AKAM-139 CTCI-65 TYL-34 BTJ TZOO IMA HWAY HMSY PSPT ISYS TRMA MO WNR FORR DGX WEBX PT ALY TXCO GPIC MIR OMRI BRR BMRN STEC DUCK MA
Shorts Outperforming (all): JOYG-34 GYI-25 GTRC-18 POOL-16 PII-15 RS-15 PDCO ARO BTH IYT AME HCBK WTI WERN FRC FDX EXBD NCI XPRSA STLD X KNOT IART SIGI NC CCO KG CFC CSE CBD EL
Completely Cover Shorts: RMK
Stocks On Radar Screen: GHDX CPA CWTR VARI OSG VOLC ZTM TIVO FLSH RGX UDR SOFO
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