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All they needed was a day-and-a-half of selling on well-placed Regulation Fear and the bulls are back!

I don’t know if I want to laugh or cry about some of the 2007 type behavior I am watching out here, but it is what it is. I guess we’ll know it’s a top when Ackmanism raises another $2B one-stock idea fund and calls it Yummy Targ-eh!

If there is no consensus shame in buying the SP500 up here, I certainly have no shame in reminding you where I am going to be selling it again. We issued this call on Friday and labeled our Q2 Theme April Flowers, May Showers. The overbought price level for this part of a massively bullish cycle remains 1214 (dotted red line).

Potential catalysts on the downside:

  1. AAPL earnings – oops, or is that still everyone and their brother’s catalyst on the upside?
  2. GS breaking down to $156? GOOG breaking down to $538?
  3. Producer Prices (PPI) will be another inflationary report on Thursday
  4. Dodd and his circus of clowns who live in the Bubble of US Politics performing under the Big Top (Thursday)?
  5. Gordon Brown will likely go at Goldman in the UK election debate Thursday night
  6. Home Buyer Tax Credit expires at the end of the week

The first line of immediate term support is now 1183. From today’s low volume intraday high of 1208, taking a peek at 1183 will definitely get people’s attention (a down -2% correction). Don’t forget that Friday’s down -1.6% day was the first down move of over 1% for the SP500 in 2 months. A down -2% move might be needed to remind people in this country that what goes up, can come down.

Keith R. McCullough
Chief Executive Officer

April Flowers: SP500 Levels, Refreshed...  - S P