Since the first OPEC oil embargo nearly four decades ago politicians have successfully diverted attention from their own lack of developing coherent and effective energy policies. It's no different today.

U.S. Senator Ron Wyden woke up this morning, read some polls, and then wrote a letter to the CFTC demanding a clampdown on speculators blaming them for high energy prices.

This behavior continues the irresponsible political diversion allowing politicians to not exercise real leadership. It results in little additional energy and illusionary scapegoats.  

Another commodity beat down day on Wednesday inspired by more CME crude oil margin hikes. (And, the CME just raised crude oil margins by 21% and "crack spreads" by 50%!) Meanwhile stocks fell presumably led by a disappointing earnings report from Disney ( DIS).

Previously, stocks liked higher commodity prices, a weak dollar (reversing sharply Wednesday) and QE2. As to the latter, POMO is going to be much reduced going forward and may not, according to today's Fed schedule, meet their stated goal. This will sadden bulls as trading ammo will be lost.

The lead headline at Yahoo Finance stated stocks "paused" Wednesday from the previous three-day rally. This was a curious term choice since markets were hard hit by selling.

Tonight's results from Cisco ( CSCO) were a mixed bag. Of greater importance are Jobless Claims data which should confirm last week's poor report or validate Friday's NFP report.

Volume picked-up substantially from previous bullish days as again stops were hit. Breadth per the WSJ was quite negative.

 

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The NYMO is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.

The McClellan Summation Index is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.

The VIX is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation is highlighted in the chart above. The VIX measures the level of put option activity over a 30-day period. Greater buying of put options (protection) causes the index to rise.

Continue to Concluding Remarks

So, am I being too harsh on Wyden? Obviously, I don't think so. It isn't a partisan thing particularly since we've had leaders in both parties not providing the leadership it takes to provide energy independence.

Diverting attention to speculators is silly political cover and ultimately won't make any difference. Last week the blame was on "big oil" and they're running out of everyone to blame but themselves.

Aside from Lazy portfolios we're cash heavy and likely to stay that way for awhile. Of the 500 indexes, ETFs and securities in our data base 203 are sporting monthly DeMark sequential 9 counts. This is usually a sign of trend exhaustion.

Let's see what happens.

Disclaimer: The ETF Digest maintains active ETF trading portfolio and a wide selection of ETFs away from portfolios in an independent listing. Current positions if any are embedded within charts. Our Lazy & Hedged Lazy Portfolios maintain the follow positions: VT, MGV, BND, BSV, VGT, VWO, VNO, IAU, DJCI, DJP, VMBS, VIG, ILF, EWA, IEV, EWC, EWJ, EWG, EWU, BWD, GXG, THD, AFK, BRAQ, CHIQ, TUR, & VNM.

 

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 .

 
This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

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.