04 March 2010

Steve Meyers: Market Decline Ahead?

As you know I tend to agree with Steve, excepting that I might make more allowance for the antics of the Fed and the Treasury in propping up the markets in concert with the primary dealers and the Exchange Stabilization Fund. I have seen a willingness to put the interests of the country second to crony capitalist profits.

Having said all that, they can make money on the downside as well as the upside, and perhaps a lot quicker. We are stuck at key resistance. A failure here targets a 40 to 60 point correction on the SP, and perhaps a test all the way down to the trendline at 1048 on the March futures.

Volume remains ominous. Rallies are on light volume, and declines bring heavier volume. But this may only imply the vulnerability, not the firm indication. The market may be primed for a trigger event. But until one appears, it can continue to drift higher, with a 'back and fill' momentum.

Honest governance is in short supply. I have taken my portfolio into a 'defensive' posture once again. But I am definitely not net short.

Wait and be watchful. Beware the Ides of March.