The summer’s been slow and this holiday week has been even slower.  The healthy consolidation keeps pushing along, so the next move should be a playable one now.  It’s funny how everyone was lamenting our inability to save back when the savings rate was near zero and the economy was booming, but people are saying we need to spend more now that the savings rate is up to 6.9%.  This is one way to get the banks back in business though, since they’re racking up deposits while paying out next to nothing.  Expect even less action as the week closes tomorrow.  Have a happy and safe 4th of July everyone.

The week ended as a dragonfly doji with light volume.  That means the bulls should take over here, but I wouldn’t bet on them dominating the market yet.  A couple more bounces in this range and I’ll be ready to pack it up for the summer.

I’m interested in seeing whether or not the market stays under $925 on this swing or if it will go all the way back to $950.  We’ve been seeing more price action lately, but the low volume still says consolidation. 

STEC is a hot tech company that makes solid state drives.  You definitely want to avoid this if you’re not an active trader, but it looks like it will have some nice swings to the upside and downside in the near future.  A fairly strong company by the numbers that carries no debt, the explosion this year was well founded and came at a good time to be amplified by the general bullish market conditions.  Increasingly powerful breakouts look like they may lead to a classic bump and run pattern.  While a company may stay fundamentally strong during a reversal, sometimes stocks just get too overbought to sustain the momentum. 

My play on this one is just to enter it manually as a prescreened stock into my auto trader.  If I were manually trading it, I would be waiting for the reversal since we’ve already passed the point that I would feel comfortable trying to swing trade to the upside.  Of course a stock this strong should also be put in the watch list for later on as a bullish position to take after a good correction and base.

The volume continued to wane in conjunction with a very narrow trading range.  $875 is still the interesting level to watch for this slide.

Is that all I have to do to get a good drop?  Just comment on how the market is looking strong?  The weak volume today doesn’t convince me that the bulls are done for, but hopefully this comment will trigger another plunge.  Oil seems to finally be coming back down to earth, but I still like the long term potential for it.  I don’t think our dependency on it is anywhere near done with.  Hope for OIH to hit the $80 range, or if we’re really lucky, back down to the $65 range. 

The first stock screen beginning investors implicitly learn is to think about the products and services they really like in their lives and look up whether the companies are public.  Palm happens to be one of those companies for me now after spending some time with a Palm Pre.  If you want a phone that lets you play games and listen to music, the iPhone is probably the only thing you should be looking at.  However, if you’re like me and you want something as a personal organizer, email, messaging, web browser, etc. device, I don’t see how you could live without the multitasking Palm Pre. 

I know I’m abnormal, but I always have at least a few different web pages loading and a couple conversations going on at the same time, which the Pre allows me to do seamlessly.  Surfing the internet on the iPhone feels like going back to pre tabbed browser days.  Is the Pre going to take over the smartphone market?  Probably not — at least not in the immediate future.  As much as the AAPL fanboys will hate me making this comparison, the iPhone is essentially the Windows of cell phones, and the Pre is a little mix of Ubuntu and OS X.  Each have their technical advantages and disadvantages, but if you aren’t leaps and bounds above the competition it’s tough getting people to switch, as Apple has found out in their PC war.  Fortunately for Palm, the turn over on phones is a lot quicker than on computers.

If Apple decides to stay AT&T exclusive, look for this race to get a lot closer much quicker.  Also, pay attention to GOOG’s big surge of Android phones coming later this year, MSFT’s WinMo 7, and RIMM who’s starting to become a bit of a dark horse after dominating the market for so long.  Of these companies, as a trader I would selfishly prefer that PALM or RIMM win the war, since dominating the mobile phone market would make a much smaller impact percentagewise to the bottom lines of any of the other gorillas.  Other companies that are interesting are ARM and Imagination Technologies, since they make the chips that all of the phones are using right now, so any expansion of the market would be good for them.  However, they’re both on the London exchange (ARM has an ADR under ARMH though).  Expect more posts on the subject in the future…

This is the first week in a long time that dropped below the previous week’s low.  Unlike the previous drops though, this one wasn’t straight off a cliff, hitting support around $900 midweek.  We’ve been seeing little signs of stability along the way, and this is yet another one.  A solid base would allow some more aggressive breakout plays here, but as it stands right now, the safest bet still appears to be picking and choosing selectively.  These are the areas where I always have to remind myself that capital preservation is the key, so expect to see that theme all through the summer.

Is the market finally going to correct some?  As much as I keep hoping for it, I’m not super confident it will actually happen.  I still have a lot going on, so summer posting will stay slow.  At the very least I’ll probably post a chart every few days with the lines I’m seeing though.

A weak day with light volume isn’t that notable.  What is notable is that we’re back at the bottom of our narrow range, so that makes tomorrow slightly more interesting.  Falling through puts us back in the $875-925 range again and would stem the bullish tide that we’ve been riding since March.  I wouldn’t bet on too much excitement with the summer lull though.