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