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January 8, 2010

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NO STOPPING BULLS

You could hit bulls with all manner of negative data and nothing seems to stop them.  Why?  Because zero interest rates, overwhelming liquidity and the belief bailouts are here to stay means risk taking has no negative consequences--that Moral Hazard nuisance.  So, as JPM's Jamie "what me worry" Dimon stated his bank is charging ahead with trading operations in derivatives and markets just as before. 

We did get the surprise today with employment data and it was a negative not the positive report as was rumored.    

Whole Inventories increased more than expected later in the morning with the majority of buying in farm equipment.

Consumer Credit recorded the largest net change in dollar terms since the data was first collected in 1943.  This doesn't' seem bullish does it?

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Stocks barely reacted and early short sellers were quickly squeezed out of their positions as Da Boyz know how to play them.

Volume was light again while breadth was moderately positive as shown by this WSJ data below.

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Continue to Major US Markets

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Continue to Major US Market Sectors & Bonds

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Continue to Currency & Commodity Markets

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Continue to Overseas Markets

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Continue to Concluding Remarks

Da Boyz turned the HAL 9000s loose despite terrible unemployment data.  Volume still remains relatively light meaning just a few hedge funds and trading desks are picking each other's pockets.  Program trading is dominant--witness today's closing "stick save".

It's hard to know what's going on with the dollar and all the bullish speculation.  It's worrisome since there seems little after today's disappointing employment report to stimulate a rush to Bucky other than some crisis.

Markets are overbought from many perspectives but bulls hold the dice and they must see great gains ahead for 2010.  Spectacular earnings had better come through.

Let's see what happens and you can follow our pithy comments on

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Disclaimer:  Among other issues the ETF Digest maintains positions in: VTI, SPY, UYM, XLY, IYR, GLD, DBC and EFA.

The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell any security.  Market sectors and related ETFs are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period.  Chart annotations aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at

www.etfdigest.com

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Dave Fry is founder and publisher of

ETF Digest

, Dave's Daily blog and the best-selling book author of "Create Your Own ETF Hedge Fund, A DIY Strategy for Private Wealth Management," published by Wiley Finance in 2008. A detailed bio is here:

Dave Fry.