Random Thoughts & Questions

Another good week for the market, though that sure wasn't a good way to end it.

I'm off until Monday, but until then here are some random thoughts & questions that were running through my mind today:

* Another week of gains. For the week, the S&P 500 rose +0.6%, the Dow gained +0.7% and Nasdaq added +0.4%.

* Aren't we spoiled! Today was the worst drop for the S&P 500 and the Nasdaq since Sept. 6th.

* Those of us who've been trying to outsmart the market have been given a large slice of humble pie this fall. Trust me, I know.

* Have you looked at the stocks trading above their moving averages this week? We booked some very extreme readings that haven't been seen since last January.

* Does this week's housing data and GDP indicate were in for a hard-landing? No, but it sure doesn't help support the perception of a soft one.

* Run them up until the election has been the game plan for Wall Street but will next week's results change anything?

* If hedge funds lean for the Dems and they gain control over Congress, does that mean we'll see a post-election party or just a sell-on-the-news trade?

* Money flow reports this week indicate that individual investors aren't buying aggressively into the rally. They are buying ETFs with a concentration on large caps and tech.

* Best we can "expect" in coming weeks is a lot of choppy consolidation. Just my two cents worth. Anything more on the upside from here will be on fumes.

* Performance anxiety by the mutual funds has been a positive catalyst lately but that will only take us up so far.

* I don't like to see the pullback in chips. (A favorite sentiment tell of the big mo traders).

* However, the ramp in precious metals is trade "worthy" if you're nimble.

* Housing sales are up and prices are down, but I think we're only seeing the beginning of some very tough times for the housing market. I think I smell a classic value trap.

* Home prices fell 10% last month! But, did you know that does not include costs associated with buyer incentives?

* Wouldn't it be ironic if the "best performance" times of the year coming up registered the worst performance?

* No, I don't know whether Google will hit $600 by January!

* Looking over sector performance this earnings season, the best of the best were in the tech, energy, and healthcare sectors. Very few surprises there.

* More than 70% of companies have beaten expectations, which leaves me to wonder two things: 1) why are expectations set too low, and 2) can it get better than this?

* Interesting stat - the world's five largest oil companies earned a combined $240,000 per minute in the third quarter.

* For what it is worth, consumer confidence has typically been a good contrarian indicator.

* I think the Dow will test its 50-day moving average before the end of the year.

That is all for now. See you on Monday!