September 12 - 16

We saw several instances of high minus tick throughout Monday’s trading. Theyresulted in offsetting rallies. We realized our minus 1200 tick that actually resulted much more than our profit objective! A profit of 4 S&P points was reached for our advisory trade. If this market can handle the European contagion, we are probably on the cusp of realizing some upside traction. The bonds are not experiencing the same panic reaction that we have seen in prior Greek tragedies. Instead, the bonds still are remarkable in their ability to hold these lofty prices. Be patient as a close below 139 needs to be experienced. We are seeing an attempt to rally in the face of bad news, imagine what can happen in the face of good news. If the S&P can journey above 1220 in the December futures, we can go into hyper drive to the upside. The 10 Yr. US Treasury auction did not bode well Tuesday. The prices are too high and the yield too low for prudent investors. Wednesday morning we saw a burst of fear created by Europe that generated a minus 1400 tick. This needs to be placed in your market journal. Minus 14000 ticks generally mark major bottoms. This drove prices below 1160 for just an instant and then a sharp powerful sustained rally occurred. The trade recommendation to buy on a minus 1100 tick was executed profitably. The 30 yr. bond auction went better than expected which created another adrenaline rush for the bond bulls. However, that energy could not be maintained. The relaxing of panic in Europe has allayed fears in the US. As I have been stating in my advisory lately, the US market will gradually bring a different feeling to international investors. They will have less trepidation to participate in our market. This will bring in more monies that should extend movements to the upside in a greater percentage than other world markets. The bonds actually broke below 139 for a brief instance Thursday. It needs to close below it. It still seems that a rescue effort is always generated to keep from breaking a support area that would represent a chart pattern that is disintegrate. Patience is the key.