The market didn't do our momentum indicators any favors today if you are a long investor. I am still curious to see how our fast momentum indicator reacts over the next day or two. It is near its normal oversold level (but not as severe as the recent bottom). If it gets back to behaving normally we should see it bounce and with it begin to level out the moderate and slow momentum indicators. Also if you are into the technical analysis you will see that we have retraced about 50% from the low to the recent highs. It would be nice to see a move up from here. We will let the market tell us what its going to do. For now its another sit on the sidelines day. I don't have confidence that the market will move strongly one way or the other right now.
In the on-going saga of "don't ask why", I offer up the tech sector as the latest example. It remains the most beaten up sector (even financials and housing have recovered somewhat), despite the fact that some of the big players have reported solid earnings and forecasts (IBM, MSFT, GLW, JDSU among others). Tonight CSCO beat earnings and projects 10% sales growth (albeit under "expectations"), but yet it gets beat up. Come on now - 10% sales growth when we are heading into a recession sounds good to me. Anyway, we don't ask why - we will continue to track Cisco and let you know when its perking up.
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