Good Friday, everyone, and welcome to the weekend. Oh, and Happy Halloween! If you're going to be out collecting candy with young ones, stay safe, and have fun. Anyway, it feels like forever since we've talked. We put Empire Global (EMGL) as the centerpiece of an important trading lesson in Thursday's newsletter, and on Wednesday we devoted some time and space to the incredible news from Barfresh Food Group (BRFH). I suppose the last time we talked about the market was on Tuesday. Plenty has happened in the meantime though, so we've got some catching up to do. Let's just start with an official end to an unofficial call I made back on October 1st regarding small cap utility stocks. It Was a Good Run, But... I don't know how many of you act on the advice and tips we give you here in the newsletter; sometimes it's tough to do so just because our observations are more theme-based or sector-based than specific stock picks. But, if you found a way to play the bullish observation we made on small cap utility stocks back at the beginning of the month, we recommend you go ahead and lock in the 9% gain the S&P 600 Small Cap Utility Sector Index has dished out in the meantime - that move looks like it's getting tired. Besides, the large cap utility stocks are conspicuously not mirroring the bullish move. I know some of you - probably most of you - are shocked that utility stocks can more that far, that fast. Like we told you then, however, never say never, and never assume "conventional wisdom" is true. The market can do (and does) crazy things. Your job is to capitalize on them when the opportunities arise, no matter how implausible they seem at the time. On the other hand, as Kenny Rogers put it, you've got to know when to hold 'em, and when to fold 'em. The S&P 600 Small Cap Utility Index had a good run, but from where I sit, this move looks like it's run its course. By the way, a bunch of you were asking if we could turn theme-based ideas about sectors into specific stock-trading ideas. We can, but we're probably not going to do that for a couple of reasons. The biggest of those reasons is, picking a stock - and then maintaining an "open trade" on that stock - isn't quite in our wheelhouse any longer. We've just got too many other things on our publishing plate to do stock-picking well enough to do you justice. If you really want some great stock picks, we'll refer you to our friends over at the Elite Opportunity newsletter, who do NOTHING but find and recommend stocks, then manage those open traders for subscribers. Trust me when I say there's nobody else besides the EO you'd want helping you find opportunities in this nutty market (and that includes the team that writes the end-of-day newsletter you're reading right now). Yields Brewing Up a Move It's been a while since we took at look at a chart of yields and bonds, mainly because there's just been nothing to talk about. And, technically speaking, there's still nothing going on. Knowing that things change right when it seems like they're not going to change, however, I can't help but wonder if traders are poised to impose change without even realizing it. Our usual chart of yields and treasuries is below, but this time I've added 200-day moving average lines (black) for each. I've also plotted support and resistance lines (gray) for both, and in each case, the instrument in question is at or near the end of a converging wedge pattern. It also appears the 200-day moving average line is playing a role in the reversal of each. I know it's an unpopular way to analyze or predict interest rates, and I'm not etching my opinions in concrete. I will say, however, that the technicals have a funny way of rationally reflecting the opinion and economic factors that push and pull interest rates. In other words, I'll interpret these technical charts at face value and keep an eye out for a "turn" for interest rates... especially now that the Fed has made it clear a December rate hike is on the table. Too Good For Our Own Good? Were you aware October was the best month the market has seen in four years? It's true. The S&P 500 gained 8.2% in October. Granted, a lot of that was just fortunate timing of extraordinary circumstances; the market crashed hard in August and had to form a double bottom in late September to work all the bearishness out of the market. Still, an 8% gain in any 30-day period is pretty darn amazing. Yep, this really wrecks my theory that the market had to make one last, painful, capitulatory move during October to clear the deck for the Q4 rally. Heck, the rally we've seen thus far for the fourth quarter is already bigger than the usual rally we see over the entire three-month stretch. I have a feeling that's going to present a headwind to bullishness for the rest of the year. While the index may technically be on the fence, I've got a funny feeling it's the VIX that will drop the first hint as to where stocks are headed next. The Bollinger band surrounding the VIX is really closing in now, which means we're due for a divergence soon.... fueled by some more volatile movement from the VIX. Whichever direction the VIX moves, I'm looking for the market to move in the opposite direction. By the way - and we'll talk more about this next week - the short-term TRIN moving average is still at pretty high levels, suggesting there's still room for more upside from stocks. This flies right in the face of the "overbought" theory we were just talking about. Like a said, we'll talk more about it next week. If you want a great lesson or a review of the TRIN lesson though, look back in your past editions of the SmallCap Network newsletter. (You are saving them, aren't you?)