A Karl Eggerss Blog
Just a reminder that the 2008 Fort Worth Money Fair will be Thursday May 8th at the Will Rogers Memorial Center. I’ll be there Wednesday evening at the VIP event and all day Thursday. To register, just click http://www.bizradio.com/fwmoneyfair2008/ or call (800) 652-3263
Make sure you register and look for me when you get there.
At a little after midday, the Dow is down about 100, the S&P 500 is down about 9, and the Nasdaq is down about 16. Commodities leading the way higher with oil trading over $120. Down volume is about 2/3 of the total volume. Overall, volume still very low though. News just came out saying that 2/3 of banks are tightening their lending standars. We saw this coming for some time. When the economy is slowing and possibly in recession, probably not the best thing to tighten lending standards. Oh well.
So, is this the beginning of a big leg down or just profit taking after a good week last week? It’s too early to tell. However, if we close down, you’ll hear tons of people saying that we reversed right at the 200-day moving average on the S&P 500 and couldn’t break through. I wish it was that easy. Using the 200-day moving average as a trading tool hasn’t been very profitable so be cautious watching that. We could easily pull back to 1390 on the S&P 500 and still be in an uptrend.
For the next few days, I want to see the quality of this pullback. Are sellers getting antsy? We’ll see as the days go on but I’ll be looking to sell some things very quickly if the selling intensifies. I won’t add more shorts until I see a lot of evidence that the run since early March is indeed ending.
I’m still fairly neutral but the market has to prove itself to me. So far it hasn’t done that even though the indices have gone up. On the way up, less and less stocks are participating in this rally. That’s a big concern.
So, to sum up, I’m net long in my portfolios I oversee and benefiting on up days. I’ll be looking to lock in profits and sell laggards shortly if I see this downturn materialize. In addition, I’ll be looking to short more American companies as selling pressure rises.
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