What a difference a day makes. Things are heating up, not only for Rove and company, but for the US stock market. The fear going into tomorrow is how the dollar will hold up. We could get a one two punch if GDP is lower than expected and indictments against senior White House officials are handed down. Remember that most market collapses are currency driven.
As far as the technical picture, it is looking bleak. We are definitely in a bear market. SPX tried a few times to hold above the 200 dma, but to no avail. The selling today was brutal. Even the COMP lost the 200 dma and that is bad news for bulls, especially since no near term catalysts, other than the calendar, exist. Microsoft missed and semis are getting clobbered.
If you do not know what you are doing, it is best to stay out of the markets the next day or so. This is not the time to play hero. I still expect a second week of November rally, but it could get a little scary tomorrow or Monday. Greenspan needs to soften his stance and announce that this is the last hike, or we are going to have a dismal fourth quarter. I for one can't wait until he leaves and his successor takes over. There are already rumors that Bernanke will be cutting rates. But January is far away.
The COMP must hold the 2055 area or we will be visiting 2000 very soon.
This entry was posted
on Thursday, October 27, 2005 at 3:44 PM.
