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Weekend Analysis for Thu July 3rd 2008 
Thu July 3rd 2008
Dangling By A Thread
by Jack Steiman
That's what this market is doing, especially the Sp. It's trying very hard not to lose that March low at 1256. It tried to lose it today but the bulls were able to muster up enough buyers to defend it. As it's the long weekend and not much occurred today I will keep this report brief today but if you look inside the gains today one thing remains clear. The advance decline line was once again negative. With the Dow up nearly 100 points you'd think the advance decline line would be quite strong but a glance inside those numbers show exactly the opposite. Far more decliners than gainers on the Nyse coming in at nearly 2/1 negative and 16/10 negative on the Nas. I'm not saying we can't have an oversold rally but buying stocks with the Dow up nicely yet the advance decline line being so horrific, that just doesn't make sense. Red flag that says easy on the buy button.
If you want to paint a positive spin on things you can say we are deeply oversold and that would be true. It would also be true that the sentiment figures are very strong for the bullish case. Even the put call ratio is starting to slowly but surely fir up. Today saw readings in the 120's and yesterday we saw 1.433 and 1.64. Those are numbers that can start to put in a bottom but we need to see those extremely high readings for several days. We have a start but it's far from perfect.
We continue to stay basically cash for now to gain more insight and we feel great about keeping you safe. The bears remain in control for now.
Have a great holiday weekend.
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Former columnist for TheStreet.com, Jack Steiman is renowned for calling major shifts in the market, including the market top in October 2007.
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