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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Cogito Ergo Sum who wrote (69079)	5/2/2008 11:53:00 AM
From: blazenzim	Read Replies (1) \| Respond to of 74559

I think the 1425 to 1438 area has about a 70% chance of forming a short term top. The key is short term. I think we can pull back to 1375 and that's about it for now. We've made it through earnings season, the sheeple will be spending $110 billion in stores and restaurants, loan delinquencies will improve due to a portion of the rebate checks making it to mortgage and credit card payments. Sheeple are optimistic by nature. They won't begin to price in a more serious problem until the data cracks them across the face. Meanwhile, the banks are earning a huge interest spread allowing them to recapitalize and offset loan losses through earnings. 2% money market yield also makes IYR yield of 4.7% look relatively attractive as well as the dividend yield on financials. It's not all doom and gloom for the next few months. In fact, I might be getting a little too tricky trying to stab at a top right here. I don't a full resumption of the bear market will arrive until the Fall. However, if McCain is elected, I wouldn't be surprised to see a big rally. Stock market loves low taxes and stimulative war spending.