As today progressed it seems bulls wasted good buying power. I left for the airport at noon amid a strong rally, but when opening the laptop to check on things at the hotel the rally had fizzled despite a “stick save” into the close.

Yesterday I noted the McClellan Oscillator as oversold and it didn’t take much in the way of news to kick-start stocks higher. The retail sales data got Uncle Buck going too as bond yields rose which also hit gold hard early. That data was of course the result of refund checks Chucky was quick to spend. But, it also included higher food and energy prices that goosed the reading some. And, hey, we’re supposed to exclude food and energy prices according to Big Brother aren’t we? It’s only right. No matter how you cut it this retail sales number may be just a one time event.

Bulls were also pumped-up over declining energy prices until that dream faded as prices rose while stock prices gave up most gains into the close.

Volume was heavy again today but breadth wasn’t very impressive and neither is Yahoo/Finance’s math. Maybe they need GOOG just for some spreadsheet work.

Today was pretty disappointing all things considered. A big rally fizzled even though indexes closed higher. Below is the McClellan Oscillator and you can see again that it showed things almost as short-term oversold as in February or March.

Support seems to be holding for many markets while commodity markets led by food and energy continue to sky. But, I add the usual caveat, the week’s not over.

My wife and I marveled just a few weeks ago when LEH CFO Erin Callan was featured in a large and flattering WSJ story featuring her good looks and personal clothes shopper. Given LEH’s problems then the piece seemed unseemly. Now she’s been taken down a peg or two and might be shopping herself at Sam’s Club.

Don’t you find the congressional representatives downright incompetent and pandering?! Here we are with huge energy supply/ demand imbalances and they want to discuss global warming and speculation in, as one put it “those dark commodity markets”. That’s because they’re clueless and mean to distract American’s from their poor stewardship of the country’s energy policies—and this doesn’t even include ridiculous agricultural policies. I’m going to leave you with this quote from a man I admired many years ago. He was the right man for the job then and his prophetic words ring true today.

“With every passing day, the specter of an energy crisis in this country looms larger and larger. The privately owned sector of this country’s energy industry states flatly that there is a problem, that it is continuing to worsen and that the nation will soon be on a collision course with a major energy shortage. Despite claims by some environmentalists that the industry sources are over-emphasizing the problem there is now general agreement that domestic supplies of natural gas will begin running out in ten years, oil in thirty years, and uranium-235, the basic fuel for nuclear power, in thirty years. When this happens, the United States will become totally dependent upon foreign sources for these fuels. We would be at the mercy of foreign powers who would be in a position to jeopardize our way of life, our industries and our national security.”

Statement on the Senate Floor
March 22, 1973
US Senator Barry Goldwater

Have a pleasant weekend.

Disclaimer: The ETF Digest maintains positions in: TLT and TBT.

Last 5 posts by David Fry

• MARKET COMMENT October 22, 2009 DRIVE-THRU SOUP KITCHEN 2009 So, what the hell was yesterday about anyway? - October 22nd, 2009
• MARKET COMMENT October 20, 2009 TAKING A BREAK It was a pretty strange day. - October 20th, 2009
• MARKET COMMENT October 13, 2009 EARNINGS WORRY WARTS I just have a spooky feeling but then I always do. - October 13th, 2009
• MARKET COMMENT October 8, 2009 GETTING SOME ALTITUDE SICKNESS YET? - October 8th, 2009
• MARKET COMMENT October 2, 2009 REALITY BITES BULLS Economic reality is meeting bullish enthusiasm and the results are disappointing and upsetting. - October 2nd, 2009