Feb 4, 2005

Yeah But...

The tape is gliding higher and lots of momentum patterns are managing to add to gains. Something does not feel quite right to me though. Maybe the market is just experiencing anxiety over the bad jobs report but there does not seem to be a great deal of volume associated with the price climbs. Take a look at Intel (INTC) for example. Anemic. Also, I am not noticing many new stocks breaking bases to create the next wave of advancers. I am trying to sit on my hands here and just roll up stops.

One more thought, if the jobs numbers created a deflation scare wouldn't the Euro appreciate like crazy? Unlike the U.S. and Japan, the ECB has been unwilling to print currency in an effort to spur growth so I am not sure how deflation makes the Euro weaken.

I gave my little tirade about the slack jobs market this AM but this guy really digs into the numbers. And while I am back on the subject, today's labor report seemed pretty much in line with other recent reports so in my view it was really the distortion of expectations that stands out. Maybe we get a reflex action the other way next month with predictions well below the announced number.

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