Quote of the Day
Tuesday, March 06, 2012
March 6, 2012 -- Why, I ask myself, do I write a piece every day, five days a week? It isn’t easy, it isn't fun when often I'd rather sleep than get up at 5 in the morning and type out a site.
I write every day because I come up with new thoughts every day, and my writing every day serves to "hold the hands" of thousands of my subscribers. Furthermore, writing every day is a habit that keeps me thinking and keeps my mind active. Lately I've written frequently about the "internal" market that most people aren't aware of or aren't interested in. The internal market consists of advances and declines, new highs and lows, volume considerations, volatility, patterns in the Averages, dividend yields, and the like. The external market consists of the obvious; stock prices, group prices, relative strength, sometimes stock formations and other obvious phenomena that can be seen and understood at a glance.
Often the market will embark on a path that may require a week or two to complete. It may take a series of daily sites to describe what is happening.
But momentum tends to increase, and in this case the increase is towards the downside
This can't be described in a service that appears maybe once a week or every other week.
If there is to be a breakout it seems to me that the breakout will be to the downside. I read the daily newspapers every day, and they tell of a hundred potential disasters everyday -- from the nearly-bankrupt US Post Office to warring Syria to the deficits in Greece to the insanity of Iran.. Yet the loss of upside momentum is telling us something. There's an ill wind blowing over Wall Street, and it's making me very nervous.
My old friend, Joe Granville insists that the top for the internal market was reached on January 3. Since then, the momentum of the internal market has tended to weaken. In truth, the market acts heavy, as if it is carrying something heavy on its back. The Dow futures are minus almost every night. The upside momentum seems to have left the market. What's weighing on the market?
TODAY'S MARKET ACTION:
My PTI was down 6 at 6375. The moving average at 6349, so my PTI is bullish by 26.
The Dow was down 203.66 to 12759.15.
Transports were down 78.49 to 5047.25.
Utilities were down 1.98 to 452.53.
NASDAQ was down 40.16 to 2910.32.
S&P 500 was down 20.97 to 1343.36.
There were 269 advances and 2804 declines on the NYSE.
There were 25 new highs and 30 new lows.
April light crude was down 2.02 to 104.70.
Total Volume on the NYSE and associated exchanges was 4.2 bn.
Bonds: Yield on the 10 year T-note was 1.95. Yield on the long T-bond was 3.08. Yield of the 91 day T-bill was 0.081%.
Dollar Index was up 0.52 at 79.82. Euro was down 1.21 at 131.06. Yen was up 1.05 at 123.84. Currency Prices as of 1 PM Pacific Time.
April gold was down 31.80 to 1672.10. May silver was down 0.91 to 32.78.
My Most Active Stocks Index was down 15 at 274.
The Big Money Breadth Index was down 10 at 1012.
GDX was down 1.15 at 52.47.
HUI was down 10.74 to 502.39.
CRB Commodity Index was down 5.00 at 314.45.
The VIX was up 2.81 to 20.86.
Permanent Portfolio Fund (PRPFX) was down 0.21 at 48.91 (previous day closing). YTD Return: 6.12%.
Late Notes -- Oooph, it finally happened. The downside momentum finally kicked in, and the Dow fell sharply. No particular news caused the break. The only question now is -- will downside momentum increase and will it push the market further down the hill. Remember, the internal market topped out on January 3, and since then we've been watching the external market trying to hold up. But the external market always follows the internal market. When the soldiers retreat, in due time the generals will follow. It's particularly significant to see the market start to fold -- just when the economic news turns rosy.
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