Part quant, part fundamental, part redneck, all honest, review of stocks, markets, and trading

Nothing passed the final screens and as I stated yesterday, it looks like we have a minor rally underway, but until Labor Day and afterward, we will not really see the next true market turn. Longer-term measures are bearish, but shorter term measures of momentum are teetering between major junctures. Currency, bond, and Fed moves will help push the direction along, but until we get everyone back in the room to do business, it’s probably a smart idea to just sit back and take notes.

If it were not for weak volume, this day might have been considered a bullish benchmark day. If we cycle between recent highs and back to lows (as we did in early July) and we finally get a real volume push (something unlikely to happen until after Labor Day), we may look back on this day as a test of lows that holds. Note that banks construction (both residential and commercial) transports (particularly rails), telecoms, semiconductors, energy related (integrated, pipeline companies, equipment), utilities, and healthcare issues all are beginning to point north. Equity (rental) REITS, particularly in healthcare, are also continuing a stealth rally.

Volume was the weakest on the NYSE since March 15, according to IBD (and I believe it, seeing a complete alacrity of trading action after the big move down early in session). Prices recovered a bit as I assume some quants, traders, and scalpers either took small positions in cheap stocks or played the gap fills along the way. What I think is notable is that Emerging Market ETFs (particularly Asian ones) continue their stealth rally that began in July. SMH and the semiconductor stocks may also attempt another rally if volume ever shows up from buyers. That continues to be the key question as we head toward the end of the month and into Labor Day. Electronics and energy services (drilling, pipelines, and machinery) continue to pop up on the bullish reversal screens. Specialty retail names are also showing up, but nets are a bit ambivalent on them (and many of the retailers really are not that cheap).