12/14

12/15/2007, at 12:28 am

Not a very positive end to what could only be termed a pretty bad week.  Even some of the defensive and market leaders like PG and KO have begun to show real weakness with some heavy selling late in the day recently.

These are not good signs.

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Even Cramer said something today that we agreed with, which is unusual.  He suggested, and we now agree, that a good GS report next week may be met agressively by short sellers to drive the financials lower.  This is contrary to what we suggested yesterday, but after he said it we began to rethink our comments yesterday and now believe that this could indeed be a successful strategy in this current market environment.

An environment where everyone is very cautious and unwilling to make any significant commitments to the upside, and where a concerted effort to drive these financials lower could also trigger a major market move to the downside.

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We would not be surprised if the markets rallied on Monday, but we would be surprised if that rally resulted in any significant move above the now declining 50 Day MA’s on the DOW and S&P, especially given that so many market leaders are beginning to show some weakness, most significantly late in recent trading days.

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There just continues to be NO significant catalyst to suggest that the markets have any good reason to rally strongly to the upside. 

Coach BD 

Filed Under: Past Commentaries