Yet Another 1/2%

The market seems to go up and down around in one-half percent increments, today being no exception to that rule.

The pullback came on lower volume, which you have to say is a bullish sign. While some blame higher oil prices and just pure profit-taking as the leading culprits, I still think there is still a wee bit disappointment that the Fed isn't almost done with raising interest rates. While we all hope that Greenspan's view that everything will work out (isn't that the typical American thing to do), I don't trade or invest on optimism.

I know, I'm not suppose to worry about stupid things like inflation and the Fed or that the commodities boom may not be entirely finished, but I'm also not sure I buy into this whole soft patch concept or how this time is different in the real-estate market.

Although a few weeks ago I thought this market was a buy as people got far too bearish, I'm not so sure I can make the same argument for the bulls after such a big upside move, even with today's minor pullback. Those negative and unfortunate folks got cleaned out, or will be shortly, and when that is done, I'm left wondering what will propel the market higher, or at least significantly so. The best case scenario I'm leaning toward is one in which we go back to the old trading range, which is about as interesting as watching paint dry.

Yes, I've been impressed by this tape in recent weeks, and I always respect it. Mr. Market is smarter than any one of us, and I see no reason to fight him. But, I do know that for me to make money, I have to be very careful and always selective, which is why I sit in cash, I keep building watch lists, and I wait, watch, and listen. While it doesn't pay the bills, it will eventually. It always does. See you tomorrow as we figure out Mr. Market's next big move!