Market Observations 10/27/06
In our top story tonight, the leader of al-Qaida in Iraq, Abu Musab al-Zarqawi, is STILL dead and someone else has taken his place.
After 15 new highs in 18 days, you could smell it coming.... between 1:00 and 2:00 ET, it was reported that Goldman Sachs cut its growth forecast for motherboard shipments.
After the broker reportedly said motherboard demand is "falling off a cliff," tech stocks did just that, and the rest of the market followed.
There was a minor increase in volume and volatility, but nothing compared to the consolidation on Tues 17th. This week, the DJIA still closed over 12K. SP500 ran past 1381 & headed for 1405? and NDX ran into 1745 heading for 1795?
As stated previously in these pages, if the Demos take the house & senate, we expect an unfavorable market reaction which could last until the end of Nov.
Perhaps SP500 gets near 1405 then retraces to the 50DMA around 1325 and could also test 1290 support.
Such a consolidation would give the market time to reload for another runup in Dec as the Santa rally shows up. Topping 1450 by year end would not be out of the question, setting up another downstroke from new heights as 2007 gets rung in.
Should gold go over 605, and the 10 yr bond go below 4.60, it might be time to hedge with gold, as this may signal another round of major dollar debauching to come.
In the near term, perhaps Non Farms & ISM reports hold surprises next week. Despite todays overdue downstroke, onward and upward might be the mantra until Nov 7th, election day?
Most major indices have made YTD, 5.5 year or all time highs in this runup. Excepting the NDX, RUT, MID & DJTA. Let's watch carefully.
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!
After 15 new highs in 18 days, you could smell it coming.... between 1:00 and 2:00 ET, it was reported that Goldman Sachs cut its growth forecast for motherboard shipments.
After the broker reportedly said motherboard demand is "falling off a cliff," tech stocks did just that, and the rest of the market followed.
There was a minor increase in volume and volatility, but nothing compared to the consolidation on Tues 17th. This week, the DJIA still closed over 12K. SP500 ran past 1381 & headed for 1405? and NDX ran into 1745 heading for 1795?
As stated previously in these pages, if the Demos take the house & senate, we expect an unfavorable market reaction which could last until the end of Nov.
Perhaps SP500 gets near 1405 then retraces to the 50DMA around 1325 and could also test 1290 support.
Such a consolidation would give the market time to reload for another runup in Dec as the Santa rally shows up. Topping 1450 by year end would not be out of the question, setting up another downstroke from new heights as 2007 gets rung in.
Should gold go over 605, and the 10 yr bond go below 4.60, it might be time to hedge with gold, as this may signal another round of major dollar debauching to come.
In the near term, perhaps Non Farms & ISM reports hold surprises next week. Despite todays overdue downstroke, onward and upward might be the mantra until Nov 7th, election day?
Most major indices have made YTD, 5.5 year or all time highs in this runup. Excepting the NDX, RUT, MID & DJTA. Let's watch carefully.
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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