KM ; Not like Friday was, since the Dow rolled off her top this
was the lowest volume day of all, it's not even fair to compare them.
We are just now getting bak down to were I saw the mess up and
the small ( thinly traded components took her up ) ..well they have
done well holding her but that dance started ending over a week
ago. I called her to go to 10250, I'm lowering that now to under
10000..and as low as 9250 ( Unless interest rates fall it's stupid
not to buy bonds and short this market. )
People are not buying bonds yet because they think they will get
cheaper, ( and they might ) but if they do the market is going
to fall that much harder.
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It's way over priced compared to interest rates as it is,
and to sustain it's present level the TYX has to come back
down to at least 5.25, if that don't happen something is going to
give and you can count on it.
The longer it takes the more dramatic it will be..
The Bulls will likely turn bearish at 9990.
I already see beyond the brave face facade most of the FUMBDUMS on CNBC are trying to project and see the fear in their eyes..& the
nervous edge in their voice as they proclaim the market
healthy..( it caught a bad case of the dropsy back in April,
it's just that the symptoms have not started to hurt yet ).
Just like if you catch Aids , you won't know you have it
for some time, in fact you may feel better than ever just
before it starts nailing you.
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So far we are 5% off our highs and headed south, I see another
easy 6% to go..for only a 11% correction, and mind you that's
being conservative to the downside.
It puts the Dow at 9925, ( if she can hold there ) and the bulls
don't panic. Then all she has to do is go up 12% to make up for
the 11% correction.
Do you really think Spam will cut rates again..if he don't
we are going to adjust. Some one has to buy enough bonds to
drop the rate to 5.25 , or we can't stay here..money will leave
not just the market but the country, in fact a lot already has
as it's been mostly Foreigners selling our blue chips up to
now ( to capture the premium on the dollar which is now up 5% YTD )
Jim
PS
I won't call 9250 yet, but I don't rule it out.
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