HEADACHE DAY

After opening lower on the heels of crummy Chicago PMI news, the markets recovered their losses, flipped to green, and closed near flat. I guess we can call that bouncing around. Yes, days after big trending days tend to be bounce around days. True again.

Best sectors were metals, reits, semis, oils, small caps, homies, biotech and software; to the downside financials, gaming, airlines and biotech.

The action in the oils is quite interesting and my $150 target on the OIH may show sooner than I thought. It traded up to the 147.5 level before selling off into the close. The XLE also ramped to $61 before selling in the last hour.

Earlier in the week semis couldn't find a bid, today everyone needs to own them. Why.

Market internals climbed most of the day finishing near the +1,200 level.

The 10 year Bond closed under 4.46% rate and I am just wondering if these rates aren't going considerably lower and that may be the reason for the action in equities. Also check out the homebuilders as they rallied 3.5%. I suspect the 10 year under 4% would be quite bullish for homeowners and home sellers.

And what is the point of pulling out troops in 6 months or so? What will be different then besides more dead soldiers- There will never be a good time so might as well do it now and get it over. Its done. Congrats to the ISG for a politically correct method of getting troops out but dumb in that more soldiers will die as nothing more gets accomplished. These guys just won't get out of a bad trade as it (Iraq) keeps going lower.