Thursday, June 08, 2006

The thesis for the markets still holds...

My expectation that we've seen the highs for this "bull" market still hold. We've seen considerable weakness in the past couple of weeks and while I was clearly off by a couple of weeks (I expected it to start on or around 6/1) the directional call was correct.

I'd look for some consolidation in here - maybe even a tradeable rally based on the unemployment #'s and the news from Iraq. At some point in the next week (by 6/16) I'd expect us to pick up 2-4%, but the buyers will quickly run out of steam and I'd expect another leg down in the back half of June.

It is important to watch emerging markets as well they have been getting creamed in the past month.

Oil is also starting to slip (now under $70) which again fits the thesis that a global slowdown in the world economies will lead to lower oil prices.

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