AFTERNOON LOOK

Markets continue higher this afternoon although considerably off their highs. Note the old adage "markets that are strong all day tend to close at their highs." Another adage, "if the markets pull back and the internals remain strong, buy the pullback."

Well nothing in trading is a sure bet but things look pretty good for another rally into the end of the day as the internals remain strong with 3,300 more winners than losers.

Winning sectors continue to be small caps, brokers, homies, oils and metals. Losers are MSFT EBAY MDT and WFC. I expect the markets to ramp up again this afternoon as the buy the dippers throw in the towel and buy near the close.

Bernanke on the tape giving the market some more ammo as he says he expects energy prices to be manageable and that energy and commodity prices might have caused recent uptick in inflation. Not real earth shattering stuff, but its better than saying we are worried about inflation.

The other problem with today, too many sports as US Open, Mets and Yanks all on the same time. Channel Hopping?