Market Observations 05/26/06

On Wend, golds biggest one day loss in over 12 years, of which half was regained yesterday.

FYI, WEND late day bounce, NAZ volume @ 2.579B, the highest volume since January 05. Thats what usually denotes the beginning of a bounce.

More FYI, OTC Bulletin Board is having many Hindenburg like days of late.

After WEND late day rebound, 2 days of broadbased followthrough on very lite volume. $, bonds & commodities broke their fall going UP slightly today. Once again, will investors believing in oversold conditions give it real legs?

Next week, 4 trading days with ISM, FOMC minutes and Non Farm Payrolls awaiting. Inflation fear numbers could spook the herd and equities would continue their fall.

Benign ISM inflation numbers and a low non farms number probably get the herd back into the shoot for a final run up the ramp into the slaughterhouse.

This could be a bounce to short into... and whether covering long positions or just shorting, timing is everything.

In 13 days, the RUT gave up almost all of its gains since early December. The RUT could continue its bounce from 696 to 750. Keep a close eye on bonds, market volume and movement.

Comments