A TALE OF 2 REALITIES

Folks, reading one of my most trusted subs this AM, besides what the coffee usually does to me, I got inspiration for this post.

If at times, the stock market movement makes no sense to you, that is because you are equating your own personal experiences into the mix, and perhaps other opinions...things you read...Gulf Oil SPill....unemployment...record food stamps.....record foreclosures.....in the end you have to make a CHOICE....do you want to take what the STOCK MARKET is willing to give you or don't you?

From the depressing lows of March 2009 when it looked like the financial system would be burnt to dust, one of the best buying opportunities of a lifetime was approaching.....at that time most were calling their brokers to SELL SELL SELL. ( I had been safely on sidelines since early 2007 when I made my bear mkt warning call)......human behavior will repeat over and over again, and when EMOTIONS rule your investing decisions, USUALLY that spells losses!

There is ONE fundamental rule that can control almost all pricing of things...that is THE LAW OF SUPPLY AND DEMAND

If on any given thing there is MORE DEMAND than the SUPPLY for that thing, the price will rise.

If you don't like that thing, or read something that says that THING SUCKS....the law of supply and demand could care less......others want it.....few are selling it....prices rise.

SO, IN THE FACE of a declining economy, few job opportunities, record foreclosures, a swan diving US $, depression like yields on interest rates, record deficits, war, oil spills, expensive oil, possible tax increases, financial regulation, a populace turning away from the stock market and overall down in the dumps attitudes.......the stock market primary rally since March appears to be still alive and kicking.....because it doesn't care what you think.

And never before do we see such demand for stock with public opinion on things stuck at RECESSIONARY LEVELS (consumer confidence).....and we do have a Consumer economy.

I will continue to give an overall view, opinions on many different topics, yes on fundamental issues.....because SOONER OR LATER they will effect supply and demand......but I will also trust my charts and the measures I get, the data that SHOW ME REAL underlying demand or not...to help guide any investing DECISIONS I will make......IMHO if you only keep a bull or a bear jacket on (based on your actions) you will lose.

Now the thng that DOES bother me, is the positive trendd mentioned above is coming with some of the lightest volume of any bull market, the trend in place almost this entire BULL CYCLE is one confounding issue....VOLUME RISES ON THE DECLINES (on avg) and VOLUME FALLS ON THE RALLIES.

In a bull market that is not supposed to happen.

Market sold off Fri on lack of emeployment data, but recovered at close......so it would appear it doesn't care......and wants to go higher.

We look for DIVERGENCES to help spot market turns, even if short term. I see some along with current OVERBOUGHT indicators......so should I WANT to make a few bucks long, I would like to see them resolved.....but any decline is likely to be brief and shallow.

When the law of supply and demand (from whom??????? black boxes???) turns against market with a vengeance, if it does......it will show on the charts.....we should be able to figure if and when the BEAR MARKET which I think is not over will return.......according to many, those same laws say the I'S have control.

D