The Day the Market was Mesmerized, w/AH Update

One of my favorite books, is about time, and written a long time ago (in the late 1800s). It's called "Looking Backwards," by Edward Bellamy. Mr Bellamy was a college dropout, utopian science fiction writer, and can be credited with inventing the idea of the credit card as a means of commerce.

It's a Rip Van Winkle Story, about a gentleman, an upper class man, from the year 1887. He awakens in 2000 from a hypnotic trance (he calls it mesmerizing) to find himself in a socialist utopia. It was a book of ages, it inspired the writing of scores of books on utopias, and spurred a political movement came to be known as Nationalism. It seems at the time, people were desperate for answers.

Well, this diversion illustrates how interesting the market is this afternoon. There's nothing to analyze, nothing to monitor, there are no answers, and no questions. Things are just quietly coming to a stop, volume is down, and so is volatility. There's nothing left to do but wait for news from beyond. News from the after hour.

Sooner or later, the market is going to like what it hears, and we'll have our rally. Will it be tonight? Not likely, considering Intel (INTC: +0.22) seems to have been bracing for impact before the session closes. It's the unknown that's so tedious. And when things get that way, I must let go, stop clinging, and retreat to a corner of my mind and dream of utopia.

---After Hours (AH) Update

INTC (+1.69:8.1%) earnings did not disappoint, in fact it was received very well and juiced up AAPL, and others, in AH. This was a nice cap to a drab day. The last regular exchange trade for AAPL was 151.30, (+2.93:1.97%).

OK, so Intel reported well, but remember that they had adjusted their guidance down mid-stream, in order to temper any weakness at reporting time. Fortunately, they came in line with their original guidance, even tacked on another 1% to their original margin forecast to 56%. Guess that mid-session adjusted guidance was not needed after all. But I think it was instrumental in adjusting expectations.

Let's not lose our objectivity here, we're not out of the woods until we see the majors reporting, then we'll re-evaluate based on the preponderance of evidence. We have some household names coming up (Google, IBM, Citibank, Caterpillar, etc). You have to be thankful for Intel, as it was welcomed news, and let's hope that it can be a catalyst to an upward trend. Just don't get too excited. Keep the emotions in check, and party on!

Is the Right Shoulder Revived?

There may be a silver lining for those perma-bulls out there with tonight's after hour action. And that is the right shoulder of the inverse head and shoulder that I have been tracking on the S&P and Naz, may have been rejuvenated. It still has a way to go before it regains the strength it had prior to last Friday, but a nice push through some key resistance levels and we would be in business. The S&P 500 needs to clear 1345, and the Naz, 2313.

-zach bass