The world has turned. Commodities and big name tech getting smoked. The Dollar (I shorted Euro's last night) has made a bottom. The rally from here could be quick and hard. Despite yield differentials between ECB's and Treasuries making new highs this week the Euro's been breaking. Treasuries are weak on a day of commodity bearishness and dovish Fed talk. Stocks? I'm not sure and I'm stuck short there. My guess is stocks break but only after every half ass bear like myself get's smoked. Way too many shorts. IMO stocks won't test the lows for a few months! Rallies will be muted but I'm open to the notion of SPX trading as high as 1530 again. (hopefully not next week, lol)
Well I'd certainly call this stealth 10% decline in energy the past week as "smoked". Or look at a Silver chart. As is every Grain, metal, energy and Meat is lower on the day. This all on an up day in stocks.
So money is coming out of inflated commodities and going back into stocks. Question is, will the rally stoke higher only to crash, or is there going to be a push back down to retest recent lows? Seems to me the news flow over the next couple of weeks is what's going to drive this market. If no more significant financial news and a rate cut, don't see this thing making new lows for a while.
With the divergence between the SP and the NAZ today... There is a good chance of a strong late day sell off in the SP and/or a gap down Monday morning to reSync the two indexes since they are correlated at a greater than 75%... anyway... just a thought... <img src="http://www.enflow.com/p.gif">
LOL Your one of the few posters I respect and listen to in this place. I disagree about the your prediction though at least till after the next Federal elections.