Market Talk / September 17th - 23rd

[mlk_man]

Time to Sell Those Small-Cap ETFs

Time to Sell Those Small-Cap ETFs

By Michael Krause
TheStreet.com Contributor
9/14/2006 2:59 PM EDT

The iShares Russell 2000 (IWM - commentary - Cramer's Take) index fund is the undisputed favorite small-cap fund among ETF investors, with twice the assets and 50 times the average trading volume of the iShares S&P SmallCap 600 (IJR - commentary - Cramer's Take). Despite its popularity, the Russell 2000 has consistently underperformed the S&P SmallCap 600 since listing in May 2000, and the performance gap is growing.

http://www.thestreet.com/_yahoo/funds/etf/10309061.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA

 

[fabijo]

So, looks like the selling is happening this morning. We should expect a rally in the afternoon if I understand the smart money v. dumb money routine. I'll be hanging out in I for at least a day or two before I decide on making a move.

 

[dell]

Possible coup building in Thailand? Space shuttle Atlantis being "followed" by an unknown object (shown on CNN and FOX). President Bush preparing to address the U.N.

I am turning off the TV and taking a nap. Maybe when I get up, sanity will have returned.

 

[Ghageman]

Hoping today's lunchtime dip holds through the close. Maybe that will set the pull back in motion...can't wait any longer. DCAing back in starting today.

 

[James48843]

TIMMMMMMBEEEERRRRRR......!!!!!!

All indicies headed solidly south today.

"C" down 0.6%
"S" down 1.21%
"I" down 1.3%

so far.

 

[FundSurfer]

You say timber, but I think they have already shown signs of leveling. Let's hope there is a rebound this afternoon. Time will tell.

 

[Birchtree]

Could be a little bear trap - watch out for the quick snap back. We're just waiting for some Mullah to lite the fuse.

 

[Spaf]

Watch out for that tree!!​

-->Tree<--​

 

[Birchtree]

Crude oil is now off $2.15 to $61.65/barrel. Now is the time to bomb Iran.

 

[FundSurfer]

.....waiting for some Mullah to lite the fuse.

Wouldn't some Mullah be more likely to saber rattle and send us in the other direction? Of course I'm thinking short term. Maybe you are thinking long term? War good for business? What'd ya mean?

 

[Birchtree]

Peace is good for global business - but there are only so many means available to achieve it. I say do it now and be done with the rogues, or there will never be peace. They want to die for Allah - A MOAB will help.

 

[Wheels]

I've discussed before how I feel support and resistance are not hard and fast numbers. By this I mean if resistance is at 1310 and we get to 1315 or so and waffle around there for a day or two, I don't consider resistance to be broken. If you punch into the low 1320's or so, now you've broken through. However, having said this, we've been doing exactly that, waffling around in the teens for a few days. Today's action sure looked like 1310 was acting as support and not resistance. Any thoughts? Especially from you TA types.

 

[fabijo]

Looks like the morning dumb money gave some good prices for the afternoon smart money. See how the afternoon rallied? The market is still in a tiny rally in pre-market. NASDAQ is up .29% and the S&P is only down .01%. I'm interested in seeing how this plays out for tomorrow. The suspense is killing me. I've got my finger on the trigger, ready to get out this week or just ride a wave up.

 

[Birchtree]

Now you know I only have one constructive thought and you're not really interested. I still own some of my small cap fund - but I am easing out over time.

 

[FundSurfer]

....I only have one constructive thought ...

Let me guess..... "Snort!"

 

[Spaf]

Dave,
We are in a trading channel. Today was 2 things: One being in overbought conditions, and two the lube scare and later relief. However in the back of the mind is the Fed meeting tomorrow! Producer prices were expected to be about 0.3%. They came in at 0.1%, that is anti inflation. Hopefully we will make a soft landing!
Spaf

 

[Spaf]

Daily Yak

The Kingdom of TSP​

Catfish Channel

Daily Edition
September 19, 2006 Closing​

Yak, Doodles, Tea Leaves & The Tin Box

Kingdom Yak:
Pro-Yak....................................Socks cut losses as lube pulls back. PPI shows anti-inflation!

Con-Yak...................................Cartel meeting looms?

Jester-Yak................................Almost a hanging man!

Doodles:
Socks [$SPX] Closed at..............1318.31, dn -2.87.
Volume (CMF) (money flow).........+0.163, rising.
Averages (MACD) (trend)............+6.619/6.011, divergence weakening.
............ (MACD) (Hist)..............declining at +0.608.
Momentum (S-STO) (signal).........85.21, falling.
Strength (RSI) Overbought/sold....[70] 63.56 [30]

Lube (NYM) Closed at..................61.66, dn -2.14
Oil Markers................................<70= ok, 70-75= worry, >75= panic.

Tea Leaves:
Yakndoodles..............................Yellow (caution).

Tin Box:
Position....................................100% G.
Stops [$SPX].............................Alert: 1306. Trail: 1293.

 

[robo]

MARKET COMMENT

September 19, 2006


Some think markets are being “propped” higher. That may well be the case. One thing’s for sure; the signature of this market over the past year has been “program trading”. With trillions in hedge funds and well-funded Wall Street trading desks it’s a reality hard to ignore.

Today’s market action is a good example. Sell programs hit markets early and, typically, when selling pressure eases, buy programs take markets quickly the other way. Who can blame the players involved? They have the computers and the cash to play the game. For everyone else, it’s a spectator sport.




Bulls believe everything is going to be just fine. Falling energy and commodity prices are good as are lower interest rates. Further they’re unfazed by troubles in housing markets—they’re big buyers! To them the economy is slowing to a “goldilocks” environment where interest rates and inflation are low; the economy grows at a modest pace; corporate earnings will be fine; and, (ahem) stocks are cheap.

Bears believe rapidly falling energy, precious metals coupled with a more serious than admitted housing price decline is a harbinger of deflation and recession. Negatively they believe corporate earnings are inflated by the one time effect of stock buy-backs. Bulls tend to dismiss and isolate problems with INTC, DELL, YHOO, and automakers for example while bears obsess about them.

Tomorrow the optimists at the data dependent Fed will toss their two cents into the mix by probably saying little new—make that one cent.

From my perspective, the bull’s still have the ball.

More tomorrow folks—have a pleasant evening!

http://www.etfdigest.com/daveDaily.php

 

[robo]

Stocks: Dip Brings Out the Put Buyers

The current minor correction in stocks only retraced about half of the preceding rally, but it did illustrate that the final top in this bear market rally has not yet been seen. That is, if option trader sentiment is any guide. Both OEX and QQQ traders went heavily into puts on the dip, a far cry from what we expect to see after the rally is finished.

The market rebounded nicely from the dip toward the close and it appears that the swoon was more of a bear trap than anything. Money flow showed that buyers were accumulating positions on the dip. This Venus-flytrap closed on the unwitting sellers late in the afternoon, leaving the indices virtually unchanged for the day.

The forecast for a geomagnetic storm over the weekend and early this week was accurate. It wasn't a strong storm, but now that it's subsiding, the market can get back on track for the rest of the week.

The FOMC (the committee which sets very short term interest rate policy for the Federal Reserve) will announce its latest decision Wednesday afternoon. It is expected that the decision will be to leave policy unchanged.

We are now in the time of year we have pointed to for several months as the likely topping timeframe for the rebound rally and the beginning of the seasonal swoon.

 

[Birchtree]

The BULL is showing some character today. How many will chase the train today?