A Pause that Depresses

Well, well...lots of "jello moving on the plate", as Gary Kaltbaum likes to say.

I'm tired and headed for bed, but I will try a quick summation of the market: bleech.

Getting a tad more specific, all sectors look to be at short term tops, and some sectors look to be at LONG TERM TOPS: namely real estate (i.e. IYR), and financials (IYF, IYG).

Energy got whacked as well, but the action has been so good I can only surmise that they are pauses in otherwise bullish scenarios, like VLO. I don't mind at all. I am going to take profits in DIG, just for the sake of being conservative. I fully plan to go long again when the weather clears a bit. As far as I'm concerned the oils and oil field service companies are the stars of this market, and they should still be bought on weakness...but let 'em get weak, first.

REITS are getting clobbered, and frankly I think they deserve to get clobbered. Transports look pretty bad as well, although stocks like BNI look worth a look after they come down a bit. Transports have needed some correcting, and they're getting it.

Another trend worth noting is mega cap companies have been the mainstay of this latest leg of the Dow rally; smallcaps are not sharing the joy. This is another characteristic of a late stage rally. The smallcaps look almost shortable here; another nudge and I think there is dough to be made on the short side.

Another stock on the tippy verge of being in a bear market: SBUX (shocking!); if it decisively takes out the support at $30.30 say bye-bye to the world's favorite caffeine pimp.

Other stocks on the verge of badness: BBY, COH ...lots of retailers on the ropes. Stagflation, anyone?

Also re: my EUR/USD trade idea- my stop hasn't been hit yet. We're getting a short term consolodation that I do think could very well breaking out to the downside, probably about the same time GLD gets hit and the overall market tanks. So I don't think I'm wrong about that just yet...patience, kids...