Volume Drops to the Lowest Level on the Week with the Dow extending its Win Streak to 9 Days

A surprise uptick in consumer spending helped boost the market in the early going. Advanced retails sales jumped in the month of February by 1.1% (seasonally adjusted) much more than the expected .5%. Import prices rose 1.1% more than the expectations, but retail sales overshadowed the higher prices. Another early morning dip was once again found support as buyers stepped up to push the market to the highs of the session. Volume was lower than Tuesday’s level and it was even lower than Monday. Monday’s are notorious for light volume days and to see such a light volume day on Wednesday is not normal. We aren’t going to argue with the market and if it wants to reach these heights we are okay with it. To quote Buzz Light Year: “To Infinity and Beyond!” What was interesting about the retail sales figures is in order to get the jump in the number the government had to “seasonally adjust” the number. Actual sales fell on the month! Gas stations were the biggest benefactor of consumer spending in the month of February. With gasoline prices as high as they are it isn’t that hard to figure out this is where the consumer’s cash is going. Tomorrow we’ll get to see more Jobless Claim figures as well as PPI figures and endless squawking over the state of the economy. Volume has been low and we have certainly pointed this out to you. Options expiry weeks tend to have inflated volume capped off with Friday’s seeing tremendous volume. We do find it odd during an option expiry week we simply do not have the volume. Sure some of the stock trading volume has moved to options, but can it explain all of the volume loss? It is an interesting question and one that will not help your trading. However, it is still interesting to ponder where the heck everyone went! This market is in an uptrend and the small gains we have experienced since e last week’s follow through has frustrated many. We may have turned a new leaf and these types of gains are the ones we should expect moving forward for uptrends. No one knows, but the important thing here is to remain disciplined and do not try to be a hero. Cut your losses.