Are We There Yet?

Another rally attempt to close at new record highs falls just short.

There's lots of chatter on the trading desks about technical non-confirmations and hedge fund trouble. The mood of the market, if you will, is to not give the bulls much credit while the bottom line numbers are indeed very impressive. Up +3% so far this month, the Dow is on track to post its biggest monthly gain since July 2005 and its largest September gain since 1998. I sure didn't see that coming.

Meanwhile, according to TrimTabs so far $3.15 billion has flowed into U.S. equity funds this month which is much higher than last month but still pacing very at the low end of the spectrum. So far this year only $28.9 billion has flowed into U.S. equity funds vs. $111.2 billion in 2003 and $129.7 billion in 2004. Is there a chance will see that pick up in the weeks ahead? Much skepticism remains (and frankly for very good reason) but investors do chase performance. It will be significant on how this balances out.

As always, I hope this finds you well and in a very good mood. The fall has certainly arrived here in Minnesota and the beautiful fall colors outside my window serve as ample reminder that we're approaching the final, and frankly my favorite trading weeks of the entire year.