Daily Investment Interpretations

August 25, 2009

2009-8-25:  After advancing 5% in four trading sessions last week, the markets were overdue for a contraction or consolidation. Today, they ended the day virtually unchanged. The NASDAQ Composite rose slightly (6.25 points, 0.31%) to close at 2.024.23, the Dow closed up 30.01 points (0.32%) to settle at 9,539.29 and the S&P 500 added 2.43 points (-0.24%) to end at 1,028. Oil fell a little to $71.59 a barrel, while gold added $2 to $946. The VIX fell a bit to 24.92.
    There isn't really much to say. The markets are continuing to rise, albeit slowly at the moment. They're overbought, and at some point, they'll correct somewhat. Michael Ashbaugh has published his Tuesday technical analysis: Ashbaugh: Cleared resistance. As we know, the markets have moved up out of their recent rrading range. He
notes (1) that all three major indices have experienced 15-to-1 market breadth on the New York Stock Exchange, and (2) sector rotation is carrying the markets higher (which is bullish).

    Part of today's good news was that the Case-Schiller housing index has risen for the second month in a row, and the Conference Board's consumer confidence index rose to 54.1 in August... much higher than the 48.0 expected. This is the highest level of consumer confidence since the recession began.