Kip, I am still quite bullish until late April early May, then I see a real retrenchment coming. Very short term, I expect the current malaise to continue for the next three, maybe four trading days, concentrated in the high flyers, but fully expect the dipsters to take over again. There is still a lot of liquidity out there. The only caveat is the long bond, if it continues its fall and breaches markedly the long down trend (closing basis above about 5.4% on the 30 years treasuries, pretty close and thus scarry), I would move to more than 50% cash and expect a decline all the way to at least 8750 or so. Latter this year, I actually think we may have another three months bear as we had last year, it might even get us to the lows of last year (about 7450 on the Dow in the periods May-July or maybe even delayed to the June-August period). Short term, I do not think it is in the cards.
The turnips, of course reserve the right to be wrong and change their mind often...
Zeev |
