A FEW NOTES ON MARKET

We thought the action around April 22 had the market putting in a high at that time. We think that high and subsequent drop was a little nastier than we thought. But…we also think Friday’s action could possible put in a near term low as the DOW and S&P held the 50 day…so far. Keep in mind, a break below will have negative implications. We’ll know soon enough. But based on a few important areas that are in trouble, we do not think any rally can carry too far. We suspect we will remain range-bound for this second. Those areas continue to be:

Retail…horror show with many important names at new yearly lows.

Biotech…never got going and have done nothing but head lower in past couple weeks.

Semis…broke badly recently. Maybe Friday’s action puts in a little low but lots of broken charts.

Financials…still can’t get going but also may have found some support Friday off the recent pullback. Regionals are sitting on the 50 day. They need to hold.

Blow-ups…have you seen all the recent earning’s blow-ups? And not just in names you know. Not sure this is great news.

Strongest area remains gold and more so, gold stocks. Keep in mind, if gold pulls back, the stocks should pull back harder.

Reits of all stripes now breaking out as IYR moves to new highs. This is a defensive area…but good for the dividend player…as long as they can continue to perform.

Wish we can tell you new yearly highs are plentiful but not happening yet. And frankly, it is mostly reits, muni bond funds, some utilities and not much after that.