Much of the time in life simply "hanging in there" and weathering tough times is the key...Although the major indices finished the day well off the early lows, there were a few signs of deterioration in the market. Most notably, breadth was fairly poor, especially on the NYSE, where there were more than two decliners for every advancer. There were still some pockets of strong momentum in airlines, education stocks and small-cap biotechnology, but there was a lot of junk on the screens today. The moves in the bailout names such as AIG were a particularly good example of how bulls are still aggressively chasing. The hot money continues to be hungry for action, but it is narrowing, and the trading is thinner and of smaller names with questionable fundamentals.
Overall, it was a chaotic and messy day of trading, but the bulls continue to hold up well. This market has consistently come back very quickly any time it looks like we are starting to slip. The upside momentum is slow, but the underlying support is still extremely strong.
The biggest danger for the bears is that the market will work off its overbought characteristics by churning like it did today for a while longer. If we simply run in place for a couple days, it won't take long to set the stage for another leg up.
It is a balancing act right now, but the bulls continue to have the advantage...