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Price bounced around above the line today, but it didn't mean anything.
Closing prices were up only a point and a half, and volume was -30%
below average.

You know, you should shun anybody giving you market analysis that won't
tell you in plain English, "it didn't mean anything."  If you plot just
the day to day price changes, it looks about like the seismic trace of
an earthquake--up and down chaotically.  There's no more meaning to
every little squiggle on the price charts than the seismometer.  Shock
and rebound, seeking equilibrium, that's all.  To some extent it's the
daily news that provides the "shocks" on the Street.  Analysts are MUCH
less able to predict the ultimate effects than they pretend.  Other
things shift around in response, compensations kick in.  Cable TV shows
about the market's instantaneous minute to minute action probably do
more harm than good--they're just marketing arms of the Street, creating
excitement where there should be none.

It's not that we can ignore what's happening.  We need a keen eye for
what's really important.  These things take a while, and their ultimate
effects may not be immediately apparent.  For example, the FOMC's rate
hiking isn't about interest rates between banks.  Well, it is, but
that's not why the Fed's doing it.  It's really about producing those
"compensations" in the economy at large.

Right now the "yield curve" on fixed income investments is flat because
long-term rates aren't rising.  It may go "inverted" where short term
rates are higher than long term rates.  Why would anybody take the risk
of locking up money for the long term, when they can get more on short
term investments and be free to reinvest as conditions of the future
dictate much sooner?  It's a perversity that has consequences in the
economy and the market, but they take a while to develop.  Ready?

But back to today's action, it doesn't mean anything because it's just
what we should have been expecting.  Most big investors aren't that
interested in trading--it's the holidays, we can take a few days off
during the week and have a nice long vacation in the Carribean.  The low
volume is key.  Unlike the boom-years of the "Gay Nineties", this year
we expect Main Street DOES have tax-loss selling to do.  In there
"meaning" in that?  Well, not much we didn't know.

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

 __<_     <___     __|_     _|__     _<__     __|_     12/21
 __|_     <___     __|_     _|__     __|_     __|_     12/22
 __>_     |___     __|_     _     __|_     12/23
 _<__     |___     __|_     <___     _|__     __|_     12/27
 __<_     |___     __|_     <___     __|_     __|_     12/28

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: BUY        Date:  10/31/05 S&P:    1207
Winner or Loser:  tbd                   By:     tbd

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

... Eye of newt, toe of frog, and a side order of fries
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