Sep 17, 2007 - Issue #076
Bad Boyz! Bad Boyz! What ya gonna do? What ya gonna do when they come for you?
Like the theme from "Cops", everyone at CNBC seems to be holding their breath waiting
for Tuesday's FOMC announcement regarding the Fed funds rate. Will there be a change
and, if so, how much?
According to Larry Kudlow's "Goldilocks Economy" (CNBC's Kudlow & Company), Will it be
too much, too little, or just right?
Not even the decidedly disappointing Retail Sales report, out prior to Friday's
market opening and causing a malox moment to start the day off, was enough to stop the
Dow from climbing back into the black closing slightly up for the day.
Not even $80 oil nor $700 gold was enough. Forecasted opinions were heard for $85 oil and
As you can see, the Dow's score card would seem to indicate an internal improvement in
the Dow components for the week.
My conclusion: DANGER - EXTREME CAUTION!
There's a lot of hype out there. Some are saying stocks are still "cheap". Compared to
Many stocks are trading very far above their 200 day moving average. That means there's
a lot of room for down side correction and still be in a long term up trend.
What happens if the Fed disappoints???
Dow score card for the week ending 9/14/07.
DJ-30: 13442.52 +329.14 +2.51%. The Real World DJ-30: 55.12 +1.35 +2.51%.
UP: 23, Down: 7.
Trends (weekly charts): This is the subjective part.
Rising (Generally Higher Highs/Higher Lows) 10 (+3) 33%:
+*CAT, +*GE, GM, IBM, INTC, KO, +*MCD, MMM, +*PG, UTX.
Consolidating (Generally Lower Highs/Higher Lows) 15 (-3) 50%:
AA, AXP, BA, DD, HD, HON, -*HPQ, +*JNJ, JPM, MRK, MSFT, PFE, T, VZ, XOM.
Declining (Generally Lower Highs/Lower Lows) 5 (n/c) 17%:
AIG, C, -*DIS, MO, WMT.
+/- denotes change of direction.
* denotes change of category.
Comments? Ideas? Feedback? Let me have it, right between the eyes! I'd love to hear from you. Just reply to this zine and tell me what you think!