Market Soapbox 05/22/06

Resistance: DJIA 11775; SP500 1335; Nasdaq 2380; NDX 1750
Support: DJIA 10850; SP500 1260; Nasdaq 2150; NDX 1580

In our top story tonight, Generalissimo Francisco Franco is STILL dead. See todays other posts for more of our market observations.

Global bond rally continues as the PPT lets equities and commodities go to save interest rates. Since 05/05, SP500 -5%; NAZ -7%.

As we have stated before: the 10 year breeching 5.25 would be a fatal blow, and apparently somebody else knows this all too well.

The multiplier effect is working in reverse and a large vortex is sucking in all the liquidity. Should this bond rally continue much further, the June Fed raise will cause another yield curve inversion.

Bonds UP with the 30 yr yield falling @ 5.13%; 10 yr @ 5.03; 5 yr @ 4.93; 2yr @ 4.94`; 6 mo @ 4.97. 2yr above 10 yr 12/27 - 03/07 & 03/20 - 3/29. 2yr above 30 yr 02/09 - 03/07 & 03/21 - 3/29.

MON, DJIA a deceiving -19 on another broadbased selloff with Hindenburg like internals on lower volume. The good news?? bouncing up into the close from over 70 points down. This week DJIA -19, since 09/19/05 DJIA +494.

Indexes UP: DJUA, DJTA DOWN: Everything else BIG

Sectors UP: Tobacco, Utilities, Consumer, Healthcare, Banking DOWN: Everything else BIG

Overseas: DAX , CAC, FTSE, Hang Seng & Nikkei 225 slammed BIG.

Dollar UP vs. Euro 1.2888 & vs. Yen 110.98, XAU DOWN & gold UP @ 660.9, XOI DOWN & crude UP @ 69.96, CRB commodities index UP @ 344.21 Natural Gas +5.5%

The worst two week slump in over 3 years continues, NAZ pounded 9 of 10 days. SOX body slammed -4% going negative on the year.

European major indices have given up all of their 06 advances. Emerging markets slammed for the 10th straight day, longest losing streak in 8 years.

We are at critical support levels, XOI, TMWX, MID & RUT sitting on 200DMA, OEX & SP500 breeched 200DMA, NDX sliced through 400DMA.

Thurs, PCE chain deflator and GDP awaits. Volatility screaming with the VIX at a one year high over 22 and flirting with 2 year highs!!!!

Keep it tween da ditches, 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, this is The Nattering Naybob and your NOT!!!

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