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"Thinking well is wise; planning well, wiser; doing well wisest and best of all."- Persian Proverb

Of course I am not "short of" the man. As all Early Look titles go, we have to have some fun at these un-Godly hours of the macro morning. Dennis Gartman is one of the great grinders of the early morning gridiron. The investment community is a better place with him in it.

This does not mean, however, that I need to subscribe to the panting dog nodding that CNBC's Fast Money's producer must force his "Traders" to look into the eye of the camera with when listening to the Gartman gospel. Someone has to hold the members of this circus act accountable. The American Financial system is being You Tubed by the world, daily, and it's just too embarrassing to know that The Client (China) thinks that this is what US investors do.

So Garty, lets slap the ole red, white and blue accountability pants on and take a walk down the path of a few positions that you are currently "short of", The Dow and Gold:

1.      I have also been "bearish of" the Dow via the DIA etf, but covered my position on Wednesday's weakness

2.      I am long Gold via the GLD etf, and remain "bullish of" it

Not to be mistaken for that one Fast Money Trader who pronounces the world's most relevant growth economy with an "R" at the end of it ("China-r"), we must give the proper attribution to the "bearish of" or "bullish of" lingo - this is Garty's  - and he remains, The Man, for beating his own path with it.

Let's get back to "doing well" as it's the "wisest and best of all" positions. Being the capitalist that he is, we want to make sure Garty has every opportunity to get these positions right.

1.      The Dow Jones Industrial Index

-         Garty is right, the Dow is trading below the 200 day - but that's far from a unique short thesis; this is not a "truly ominous" chart to be "short of"

-         Immediate term TRADE support = 8153

-         Intermediate term TREND support = 7782

2.      Gold

-         Garty must know that he is getting this one wrong (after all, that almighty 200 day moving average that he is "short of" with the Dow = gold $856/oz)...

-         Immediate term TRADE support = $897/oz

-         Gold is about to lock in its second consecutive week of positive price momentum, and it's threatening to breakout again to the upside.

Now don't get me wrong here, I don't think Gold busts out to higher highs, yet... nor do I want to be "long of" the Dow. As prices change, my view on all things do. I am not wed to any position other than my marriage to Laura. I was "short of" Fast Money's "long gold, short America" call in early March, remember. Garty, for accountability purposes, have someone forward you my Early Look of 2/19 titled "Long America, Short Gold"  (www.researchedgllc.com <http://www.researchedgllc.com> ) - I get the short case, but only at a price.

One way to really perform in markets is to understand how the other players on the ice play. If you can proactively predict their patterns of behavior (200 day moving averages for instance), you can always put yourself in a position to trade ahead of them. This isn't a complicated strategy. Remember, "Thinking well is wise; planning well, wiser..."

Garty, like you, I'm in it to win it here and I want to see you keep winning man. If the Dow is down today, at a bare minimum, just cover your short. As for being "short of" gold, well, I know that you know that I'm right on this, so... cheers to changing as the facts do.

I have downside support for the SP500 at 881 and upside resistance at 931. Buy low, sell high, capitalize on consensus, and trade the range.

Have a great weekend.

KM


LONG ETFS

EWA - iShares Australia-EWA has a nice dividend yield of 7.54% on the trailing 12-months.  With interest rates at 3.00% (further room to stimulate) and a $26.5BN stimulus package in place, plus a commodity based economy with proximity to China's H1 reacceleration, there are a lot of ways to win being long Australia.

EWZ - iShares Brazil- Brazil continues to look positive on a TREND basis. President Lula da Silva is the most economically effective of the populist Latin American leaders; on his watch policy makers have kept inflation at bay with a high rate policy and serviced debt -leading to an investment grade credit rating. Brazil has managed its interest rate to promote stimulus. Brazil is a major producer of commodities. We believe the country's profile matches up well with our re-flation theme: as the USD breaks down global equities and commodity prices will inflate.

XLE - SPDR Energy- We bought Energy on 5/13 with the dollar up. We think it works higher if the Buck breaks down.  Bullish TRADE and TREND remain.

XLY - SPDR Consumer Discretionary-The TREND remains bullish for XLY.  The US economy is showing faint signs the steep plunge in economic activity that began last fall is starting to level off and things are better that toxic.  We've been saying since early January that housing will bottom in 2Q09 and that "free money" for the financial system will marginally improve the US economy in 2H09, allowing early cycle stocks to outperform.  The XLY is a great way to play the early cycle thesis.

CAF - Morgan Stanley China Fund- A close end fund providing exposure to the Shanghai A share market, we use CAF tactically to ride the wave of returning confidence among domestic Chinese investors fed by the stimulus package. To date the Chinese have shown leadership and a proactive response to the global recession, and now their number one priority is to offset contracting external demand with domestic growth.

EWD - iShares Sweden-We bought Sweden on 5/11 with the etf down on the day and as a hedge against our Swiss short position. From a fundamental setup, we're bullish on Sweden. The country issued a large stimulus package to combat its economic downturn and the central bank has effectively used interest rate cuts to manage its economy. Sweden's sovereign debt holds a strong AAA rating despite Swedish banks being primary lenders to the Baltic states. We expect Sweden to benefit from export demand as global economies heat up.

XLK - SPDR Technology - Technology looks positive on a TREND basis. Fundamentally, the sector has shown signs of stabilization over the last eight weeks.   As the world demand environment becomes more predictable, M&A should pick up given cash rich balance sheets in this sector (and the game changing ORCL-JAVA deal). The other big potential catalyst is that Technology benefits from various stimulus packages throughout the globe - from China to USA. Technology will benefit from direct and indirect investments.

XLV - SPDR Healthcare-Healthcare looks positive from a TRADE and TREND duration. We've been on the sidelines for the last few months, but bought XLV on a down day on 5/11 to get long the safety trade.

TIP- iShares TIPS - The iShares etf, TIP, which is 90% invested in the inflation protected sector of the US Treasury Market currently offers a compelling yield on TTM basis of 5.89%.  We believe that future inflation expectations are currently mispriced and that TIPS are a compelling way to own yield on an inflation protected basis, especially in the context of our re-flation thesis.

GLD - SPDR GOLD -We bought more gold on 5/5. The inflation protection is what we're long here looking ahead 6-9 months. In the intermediate term, we like the safety trade too.
 

SHORT ETFS
 
EWW - iShares Mexico- We're short Mexico due in part to the media's manic Swine flu fear. The etf was up 7% on 5/4, giving us a great entry point.  The country's dependence on export revenues is decidedly bearish due to volatility of crude prices and when considering that the country's main oil producer, PEMEX, has substantial debt to pay down and its production capacity has declined since 2004. Additionally, the potential geo-political risks associated with the burgeoning power of regional drug lords signals that the country's economy is under serious duress.

IFN -The India Fund-We have had a consistently negative bias on Indian equities since we launched the firm early last year. We believe the growth story of "Chindia" is dead. We contest that the Indian population, grappling with rampant poverty, a class divide, and poor health and education services, will not be able to sustain internal consumption levels sufficient to meet targeted growth level. Other negative trends we've followed include: the reversal of foreign investment, the decrease in equity issuance, and a massive national deficit.

LQD  - iShares Corporate Bonds- Corporate bonds have had a huge move off their 2008 lows and we expect with the eventual rising of interest rates in the back half of 2009 that bonds will give some of that move back. Moody's estimates US corporate bond default rates to climb to 15.1% in 2009, up from a previous 2009 estimate of 10.4%.

EWL - iShares Switzerland - We believe the country offers a good opportunity to get in on the short side of Western Europe, and in particular European financials.  Switzerland has nearly run out of room to cut its interest rate and due to the country's reliance on the financial sector is in a favorable trading range. Increasingly Swiss banks are being forced by governments to reveal their customers, thereby reducing the incentive of Switzerland as a tax-free haven