September 17, 2009 (FinancialWire) — Dr. Joe Duarte (http://www.joe-duarte.com) recently noted: A crazy thing is happening in the stock market. Shares of Walmart (NYSE: WMT) are cratering as shares of Tiffany (NYSE: TIF) delivered a breakout on 9-16.

Duarte added: Volatile markets make investors jittery, and rightly so. Yet, especially in portfolios that are taxable, such as non-IRA accounts, active trading can lead to a fair amount of taxable, if not accountable activity.

If you believe the press reports, jobs are scarce, another round of foreclosures is about to hit, commercial real estate is about to implode, and capitalism is near dying. Yet, Tiffany shares are near a breakout, and Walmart is about to break down.

But Walmart is supposed to be the beneficiary of tough times, with its discounts and its just in time inventory management and global platform. Tiffany is supposed to be suffering during times like these.

So why are these stocks acting in this fashion? If you go beyond the obvious, you can see several things. Walmart is probably tapped out as far as growth. There are too many stores and the number of people that shop there, although large, has probably topped out as well.

More important, its Sam’s Club, where the company pads its profit lines, is suffering, as its prices have skyrocketed. We used to shop there but have found it difficult to stomach prices there lately. So we’ve gone elsewhere. Last time we went, several months ago, the huge warehouse was almost empty.

Some of that may be due to the contraction in business for small businesses whose owners often go there to buy large lots of materials for their shops, especially restaurants.

Still, the market seems to be betting on a return to extravagance as the economy heats up. And in that setting, Walmart seems to be losing out to the likes of Tiffany.

Walmart broke below 50 on Tuesday, on a day when the market rallied. That’s a bad sign for the stock. It also took out its 50-day moving average.

Duarte’s conclusion: Unless Walmart bounces back convincingly in the next few days, you have to start seriously scratching your head in wonder at what the stock market is thinking.

You can read about trading ETFs in more details in Market Timing For Dummies.

Make sense of today’s nonsense. Get Doctor Joe Duarte’s Market I.Q., at:

http://www.joe-duarte.com/free/order_choices.asp and subscribe to www.joe-duarte.com, for its daily energy review and stock picks.

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Duarte partners with the Investors Resource Center at Investrend Information (http://www.investrendinformation.com).

Duarte’s IntelligentForecasts.com (http://www.intelligentforecasts.com) provides free news coverage and analysis, and his daily articles and news summaries offer recommendations and analysis for ETFs, and individual stocks in the technology, health and biotechnology, and energy sectors. Duarte has combined expertise in health care, energy, and the effects of politics and global intelligence on the financial markets offer a unique blend of insight and information to thousands of active investors and political and intelligence aficionados around the world on a daily basis.

He is the author of: Futures And Options For Dummies, Successful Energy Sector Investing, Successful Biotech Investing and co-author of After-Hours Trading Made Easy. In early 2001, in Successful Energy Sector Investing, he correctly predicted that Venezuela’s political problems could lead to an energy crisis in the United States. He has also appeared as a weekly guest on Market Mavens Radio and has logged appearances on KNX radio in Los Angeles, Financial Sense.com radio, and Wall Street Radio.

One of CNBC’s original Market Mavens, Dr. Duarte has been writing about the financial markets since 1990. His articles and commentary have been featured on CBS Marketwatch, Barron’s, Smart Money, Medical Economics, and in Technical Analysis of Stocks and Commodities magazines. In 2003, Doctor Duarte received second place, in the professional section, of the Medical Economics Investment Challenge with a 12-month return of 42%.

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