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Like I said this week, it can be dangerous to listen to people telling
you what you want to hear.  Let me quote from the news reports today,
some seemingly to veer off into propaganda.

"Stocks rose Friday after the government issued a relatively mild
inflation report and also reported improving retail sales."  You've got
to be deliberately spinning the facts to report that!  Inflation was
mild, IF you throw out the effects of energy prices spiking.  That
includes the effect on food prices because trucking needs diesel.  Stop
eating, start walking, and live in the cold and dark, and then maybe
that "news" will apply to you.  "Accounting for energy and
food, the CPI
jumped 1.2 percent.  [The Commerce Department] said that 90 percent of
that increase came from a record-setting 12 percent surge in energy
prices which reflected gasoline prices that briefly topped $3 per gallon
last month...  The White House downplayed the report."

"Investors also reacted positively to a turnaround in September's retail
sales, which showed consumers are still spending despite inflation
concerns."  Ummm, a gas station would be "retail sales"
wouldn't it?  Or
are they exempt?  "The retail sales report showed that sales at gas
stations were up 4 percent last month.  However, much of that increase
reflected the surge in pump prices rather than increased volume.  If
gasoline sales were excluded, sales at all other retailers actually fell
by 0.2 percent in September."  Apparently there's far less here than
meets the eye.  "Commerce Department reported that retail sales managed
to post a small increase of 0.2 percent in September.  However, that
tiny gain came after a huge 1.9 percent plunge in retail sales in
August."

"Stocks gave up some of their advance after the University of Michigan
said its consumer sentiment index for October dipped to 75.4 from 76.9,
far below economists' prediction for a reading of 80, but the market
regained its footing soon afterward."  That doesn't sound so bad.  Of
course, you have to conveniently leave out the fact that this is the
gloomiest consumer sentiment in 13 years.  What has the consumer to look
forward to?  "The government this week warned homeowners to expect
heating bills to soar this winter."

No, today's rising stock prices are due to it being due, after such a
rapid fall in prices the past couple weeks.  Notice below that the
Summation Index, the cumulative addition of the Oscillator and a good
intermediate indicator, has crossed below the line from nearly 4500 at
the beginning of August.  Prices did rise all day today, 80% of the way
to being significant change, and I suppose some people believe the
characterization by those reporters.  Of course, WE always ask, "did'ya
mean it?"  Not at all--volume sank to just +2% above average.  Where
were all the buyers?  Still, with the market negative enough to drive
the Summation Index down like this, it's about time for a little
short-term rebound.  Just don't get caught-up in it.  Watch the volume!

 Price    Vola-    Momen-   Volume   Oscil-   Summ.
 Change   tility   tum               lator    Index
 -__+     -__+     -__+     -__+     -__+     -__+

 __     _|__     __>_     <___     __<_     10/10
 _|__     __>_     __     |___     __<_     10/11
 __     __     <___     __<_     10/12
 __     __     <___     __<_     10/13
 __|_     __>_     __     _|__     _<__     10/14

Timing Signals:  I don't use or recommend timing signals, but they're
fun to watch.  If I did though, well, I might use something like this.
(Be warned!!  It tends to whipsaw around signal points!)

Last Signal: SELL       Date:  10/04/05 S&P:    1214
Winner or Loser:  Loser                 By:     -13

See my market tracking charts for '03-'04 and my investment strategy
study at my website(s):
http://www.xprt.net/~pgrogers/Pers.html
http://www.geocities.com/paulgrogers/Pers.html




Paul Rogers, paulgrogers{at}yahoo.com                       -o)
http://www.angelfire.com/or/paulrogers                   /\\
Rogers' Second Law: Everything you do communicates.     _\_V

... 4 + 6 = 10.  1 + 1 = 10   3 + 5 = 10   9 + 7 = 10
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