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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: schrodingers_cat who wrote (34620)	8/21/2004 1:44:08 AM
From: schrodingers_cat	Respond to of 206099

OSX is bouncing very nicely, and I think it is heading back over 110. The question on my mind is will it breakthrough the BIG resistance zone at 110-115? I don't think so, because of the way things look for the overall market. The S+P has bounced nicely this week, on slightly low volume, which is typical of a bear market rally. There are many problems: 1/ S+P is in an intermediate term downtrend with no sign of a bottom.....at the least recent lows must be re-tested. 2/ September is typically the weakest month of the year. 3/ The market is under the 200 dma...getting out of the market when it falls under the 200 dma is usually a good idea. 4/$50 oil is going to have major economic consequences, which are not priced into today's market. Even oil in the low 40s caused problems, 50+ will be much worse. 5/ A slump in the economy will elect John Kerry. Election uncertainty is bad for the market. 6/Nasdaq seemed to break the 1790 support level on the last dip, and if that goes 1500 is the next stop. 7/1000 seems a plausible target for the S+P. The bottom line is that I think that we are headed for a terrible September and October, and I don't see how the OSX can set new highs if the overall market is falling apart. My scenario for the next week is that oil falls back to the low 40s and the OSX and S+P rally strongly. My scenario for Sept/Oct is that oil goes 50+ on it's way to 60 or 70, and the Nasdaq and S+P meltdown as the damage from high oil prices becomes more obvious. Oil and gas stocks get dragged down along with everything else. A sinking stock market and economy will also sink Bush's re-election hopes, and his stubborn refusal to use the SPR will make it worse. Maybe I am too pessimistic?