Increasing Volume Over Several Days With Minimal Price Change...

...often signals the end of the move. Over the last week+ there have been large price swings on significant volume yet the market is about unchanged. Given the headlines about the credit markets we have had a mini panic on our hands. Is it over or just beginning? Any one with a phone has had every opportunity to sell stock and go to cash to avoid the pending disaster. With that in mind, the market is down just 5% off its peak, nearly unchanged for the last 8 sessions. If things were so bad I don't believe the market would have rallied today off the Fed's announcement. I would like the think that sellers have done their thing and this little storm is over. That's probably not the full story as there should be another shoe (or two) to drop. But, the bears had every opportunity to break this thing and that didn't happen. Now its the bull's turn.

Looking at stocks, there are many crosscurrents and some of our favorites are still stuck in a rut (MTW, CI, PCAR, MAN, OSG, to name a few) and may be sold as the correction has taught us they are no longer right for our portfolio. Others like PCLN, DECK, PCU, AAPL, RIMM, DHR, MCD, LYG, T, STRA, & SBS to name a few, are already in recovery and repair. And our focus on newer names is on stocks that largely ignored this correction. As always, we remain more focused on our stocks than the market, as it should be.

In the short term I would expect an S&P rally to 1500 and then a retest of the 1425-1450 lows. Should they hold expect higher prices. But first things first...