Between bailouts, interest rates, earnings, housing and, well, just about everything else under the sun, investors have apparently become frozen in the headlights of this market.

Trading volume on the major Exchange-Traded Funds like the SPYDRs (SPY), Qubes (QQQQ) and Diamonds (DIA), just to name a few examples, is dropping quickly after the surge of buying and selling that caused volume on these three to reach historic highs in recent months.

This recent drop in volume comes as no terrible surprise, however, as we head into the holiday season. But I think that there's more to be read from the inactivity. There are some stellar trading opportunities available for those of us who are reading between the lines.

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"Analysis Paralysis"

There's a term we apply to many in this business when they roll out stat upon stat from their black boxes that yield little to nothing on their trading results — "analysis paralysis."

This state has started to set into this market, as many professionals and most individuals doubt whether the November lows were a buying opportunity or a rest before the next decline.

As simple as it may seem, a market bottom is almost never formed when everyone is expecting it. Period!

Ah, but stock analysts on financial TV and in the papers are talking about moving out of equities and into Treasuries and other non-equity holdings. Yeah, maybe. But when you look at analysts' stock ratings, that's not really the case.

Nothing makes me happier than when what the analysts say doesn't line up with what they do because it gives me an opportunity to profit from the discrepancies. And believe me, there are a lot of things that just don't add up, going into Q4 earnings season!

Strange Things Afoot with Analyst Sentiment

I pulled the analyst recommendations for the top 25 recommended stocks in the S&P 500 (SPX) to check how analysts have changed their postures during the past year. Comparing the Buy/Hold/Sell ratings on these stocks from Oct. 5, 2007 (the market top) through now reveals…