Everyone agrees it's full steam ahead and odds are that is going to be the case. However, stocks are right at resistance and I think we need to do a little backing and filling before we get the next leg up, especially when "everyone agrees" we are going to keep rallying. Case in point, NQ (NDX futures), which has a gap to fill (see chart). The VIX is also at a point that indicates some kind of pullback in equities (see chart). It won't last, as buyers are anxiously waiting for any dip to jump on board. The DOW held on to critical suppport at 200 dma. That index has been the laggard and that is entirely due to rising rates. I think bonds are oversold and any pullback next week in rates will have the DOW go into second gear. In any case, do not short this beast unless you are very quick. For now, buy the dips.
This entry was posted
on Saturday, November 05, 2005 at 2:36 PM.
