Today, despite being somewhat down at the close, was very constructive day for the bulls. Most leading stocks retrenched a bit, but no big deal. The action struck me as consolodation before the next upward attempt.
Also for the first time in forever the smallcaps were the best performing segment of the market.
Commodity stocks look as though they will take a multi-day breather: oils, metals, and gold stocks. But after such move they look buyable to me.
Biggest story never told by the media: long rates look poised to resume their trek upward. Of course if the market rallies it will be explained as simple rotation into stocks. But if it continues what does that say about this rally? The Fed proposes, but the market still disposes. At least rising rates might give some support to the beleagured US dollar. But again- a quickly normalizing yield curve is not good news for the housing market, no matter how you spin it.
There are two realities set to collide, and I don't know who will win: the slowing economy in a housing recession, and a booming service economy...will the real economy please stand up? And in the back of my mind I must remember that this market is still on Fed induced steriods. Does that mean all the closing prices get an asterisk just like Barry Bonds?
Sells: FXE, GLD, DSTI
Buys: DUG, SIRI, CHTT
Buy stops for tomorrow: NVT, ESI, EDU, IDXX, CRNT, TNE, DSX
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