Wednesday, June 10, 2009

Market Talk

The effect of the 10 year auction results today show how focused the market is right now on the bond market. This is probably the most important thing (along with USD attempts to rally) holding the market down.

We didn't get duped by the market gap-up this morning to break-out levels. Why? Because of what we wrote last night in our newsletter in regards of a break-out in the SPX:

"Key factors that have to confirm will be volume (which has been lacking lately) and breadth ( you don't want the SPX to break-out without the financials/REITS participating)."


Today both conditions failed miserably. Sit tight, chill, get a drink. This isn't the time to make any bets until we get a more clear direction.