Zeev, I've been wondering how the Fed meeting on the 15th will affect the turnips.
In your original scenario of a drop into June, it seemed to work quite nicely. Now with the Fed on the 15th & CPI on the 16th, I believe, it seems rather unlikely they'd make another rate cut.
Some on the street are already talking about another 25BP on
May 15. Maybe if we don't get it we'll just see a re-test of 1850 instead of something lower.
If the COMP hits 1850, that would indicate around 1161 on the SPX. I just wonder how the SOXX fits into all of this.
At the least, this should set up a re-test of the Gap from around 525 10-days ago. It seems the re-test will be on the high side of that gap rather than the low side due to recent sentiment and upgrades in the sector.
FWIW, most retail chains we sell to are seeing some of the weakest Late Winter/Early Spring sales in a long time.
Our company truck drivers report that the railyards are very quiet (in the Chicago area, a huge hub for rail), and there are not nearly as many trucks on the road (many are calling, looking for business to keep their drivers working).
A year ago, you couldn't hardly get a truck to haul your goods. What a difference a year makes.
Business is slowing down, and it is making some retailers nervous. The rate cut helps, but consumer confidence is the key.
Although this slowdown was coming, Bush did not help it at all by talking down the economy to help his tax cut. I believe this affected consumer confidence somewhat (although not near as much as the plunging Nasdaq).
Furthermore, by not applying any of it to this year, he probably brought on more weakness. |
