Market Soapbox 07/05/05

Resistance: DJIA 10600; SP500 1225; Nasdaq 2100; NDX 1550
Support: DJIA 10200 ; SP500 1180 ; Nasdaq 2000; NDX 1500

European and Asian markets were up. Dollar up vs. Yen/Euro, oil, commodities & bonds up, gold down. The dollar continues to roar against other monopoly money, 1.19 vs Euro and at a 14 month high.

Today's Soohey Pig Pig!! Award goes to media coverage of oils rise to $60. Oil surged 4% on Friday in shortened trading, todays +1.5% surge was based on fears that Tropical Storm Cindy could cause shortages.

And perhaps an attack of killer cicadas in Africa could also lead to further shortages....Soohey!!! Pig, Pig!!

An up day on lighter volume. Energy, Semis, MID & RUT led the way today. Airline, Transports, Wireless, Materials were weak. XAU and Gold Bugs got beat like a drum. Energy, Oil Services, Natural Gas, Retail, Semi Mfg, Semis were strong.

Upcoming events to watch for: Options unwind July 6th & 13th, 5 year note auction July 13th, 10 year TIPS auction July 14th, options expiration July 15th, 2Q05 earnings season gets into full swing starting July 18th through August 12th.

Interesting contra trends were rising dollar & oil; the DJIA % gain lagged the other major and minor indices; the (XAX) AMEX Composite going the opposite way of everyone else, and not in a small way.

The last time the XAX did this was on 03/07 of this year, he went down and everyone else peaked, then followed his act till late April.

Today looked like a short covering rally to balance out last Thursdays thumping. Beware of options unwind tomorrow.

We take it day by day and keep our eyes peeled to the sky, because it could be a name brand that pancakes us. Just my opinion, I could be wrong.

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