A Sleepy Day For Stocks And ETFs: Day 4

After a weak open, major U.S. stock indexes and ETFs climbed back through the day to finish slightly changed in yet another day of consolidation as markets weigh the potential impact of “QE3 to Infinity.”

Major U.S. Stock Index ETFs:

Dow Jones Industrial Average (NYSEARCA:DIA) +0.16%, this ETF tracks the movement of the Dow Jones Industrial Average

S&P 500 SPDR ETF (NYSEARCA:SPY) +0.01%, this ETF tracks the S&P 500

Nasdaq 100 (NYSEARCA:QQQ) -0.01%, this ETF tracks the Nasdaq 100 Index

iShares Russell 2000 ETF (NYSEARCA:IWM), this ETF tracks the Russell 2000 Index of small cap stocks.

So, all in all, it’s easy to see that U.S. stock indexes and ETFs remain in a holding pattern as market players wait for more news and hints of the next direction after the FOMC announcement of open ended quantitative easing.

The weekly jobless claims report came in at 382,000, better than last week but above estimates, while leading economic indicators fell slightly and the “Philly Fed” report improved to -1.9 from -7.1 in August, an improvement but still in contraction territory.

On a technical basis, markets remain overbought and so likely will need to digest recent gains and could trend sideways or lower to unwind the overbought nature of most indexes and sectors.

On a calendar basis, September is typically a weak month, although it hasn’t been thus far. October is historically volatile, and bulls are already looking forward to just a month from now when seasonality and the “Halloween Indicator” kick in to start the historically best six months of the year.

Bottom line: The entire week, so far, has been sleepy and sideways as overbought conditions stifle further advances and market participants wait to see if QE3 will be a short lived burst of hope or the start of something big. Most likely, the wait to find out will be short.