THE END (EAST)

I am off to the east end for some R and R and I will leave the market chase to others. For what its worth, the market just doesn't act right and it "feels" like it wants to go lower. Don't know if its today's business but I think lower for next week.

For all the "powerful rally" talk on CNBC, the QQQQ is up about 30 cents on the week or less than 1%. The VIX is 5% below its 10 day SMA and the VXO is about 9% below. The 2 day RSI on the SPY sits at an overbought level of 98 so with these signals in mind I will leave the buying to others.

TECHNICALS -QQQQ

There is a picture of the QQQQ. Maria said yesterday afternoon that there has been a powerful rally in the NAZ this year. Well the NAZ 100 seems to show something else. The high for the year was made back in January and now it appears that we are hitting a lower high. The momentum indicators RSI ROC and MACD are all showing slower momentum and may be predicting lower prices. Lower highs on these indicators usually precede lower prices on the index itself.

Also, over the last few sessions it has been clear that the big cap stocks have been leading. In the past, when the Nazdaq begins to underperform, they all tend to rollover.

11:00 UPDATE

The action is fast and furious today as the market indexes are all over the board but primarily mixed. The precious metals have rebounded and the XAU and HUI are both +3%. Oils are higher with OIH + 1%, but that thing always trades all over the board. Other sectors sticking out MSH(-.8%),IWM flat,Internets(HHH-1.5%), SMH(-1.8%), IBB flat. The market internals are +700 on NYSE and -75 on the NAZ. FORD a recent pick of TC at globaltechstocks.com is higher by 10% and SNDK is down 8% back to 60.

The Volatility indexes are flat and the 10 year Bond is sitting at 5.03% with the homies and the Reits unchanged.

The SPY Pivot of 131.2 looks like a magnet area for today and is probably a good spot for a quick daytrade.

JUST THE FACTS

So Jimmy has put a $600 price target on GOOG. There are approximately 300 Million shares outstanding, so he projects a market cap of 180 Billion.

The largest market cap companies (estimates) are the following:

XOM - 390B
GE 355 B
MSFT 280B
BAC 215B
PG 185B
JNJ 175B
AIG 165B
PFE 155B
MO 145B

I can remember the time when CSCO had the largest market cap and many other HOT tech companies had huge valuations(AMCC PMCS RHAT RBAK BRCM QCOM). I think Jim Cramer called them the redhots and they had to be owned. I don't think they were ever great investments at those levels as the tech industry does not provide a great barrier to entry. Anyone remember Sperry, Wang, Prime, Digital, Xerox, Cray and on and on and on. So GOOG at these levels looks very familiar, and what exactly is the barrier to enter the search engine market?There is always another guy/gal/group with a better mousetrap.

And as I look at the markets, the NAZ continues to struggle even in the face of the great GOOG numbers. It is presently down on the day as is the QQQQ. The SPY is up 35 cents and the market internals look good on the NYSE but are flat on the NAZ. The SMH is down 1.5% on the news of the C sell rating on DELL. So even with all the great earnings news the markets continue to make headway with the Volatility indexes at the oversold levels.

SMELL THE FEAR

Everything is coming up roses as GOOG SLB BRCM MCD INFA all beat and trade higher in the pre market. The futures are set to gap up again with ES+3.5 and NAZ +5.25 as I type. The commodity stocks look like they are set to bounce back after one day of pummeling but no clue as to if it will hold.

Just as I complimented Jimmy yesterday he does it again and I quote:

"The big rotation is on, it is why a diversified portfolio pays off and pays off big: here we go, I would look at the Cardinal Health/UNH/CRO/Biotech/Pharma complex for the next move here"

A diversified portfolio pays off big? Jimmy, the best performers in the first 3 months and 20 days of the year were Oils Precious metals and Small Caps. They were up 15% or more. Diversifying- lets see the SPY is up 5.6%, the QQQQ is up 5.2% and is down from its high on January 11. UNH is lower by 19% on the year, Why would I want to have been diversified into that stock? The IBB biotech group is also down on the year. Is he saying to sell the winners now (Oils Metals and Small Caps) and buy the losers? I do not get it.

THESE EYES

Maria is all excited about the big rally in stocks. Don't tell her that there were a lot more stocks down than up or it will rain on her ratings. Looking closely at the action, nothing, I got nothing as the markets were all over the place with the SPY trading at its resistance level of 131.25 for most of the day after gyrating (1.26) wildly in the first hour. The QQQQ looks to close down about 15 cents and the very relevant DJIA (CNBC index of the day) is up about 65. The internals rebounded a bit and show 550 to the red into the close. Volatility indexes are unchanged and giving no signals into the end of the trading.

The story of the day is clearly the pummeling of the metals and silver in particular. Is it over for them? DOUBTFUL. My advice is to scale in and buy the metal dip.

The SPY Pivot Point for tomorrow is the 131.2 level so that really looks like a magnet area although GOOG tonight could change everything. SLB also reports in the AM so that could be an OIH mover for tomorrow(sell the news?).

BAFFLED

Markets continue to baffle all the watchers as the DJIA is up IWM down, NAZ down, Metals down, Semis up, Oils down, Internets down, SPX up, Retail up, Drugs up, AAPL up, INTC down, Volatility indexes unch, and the most baffling of all, GOOG unch.

I said earlier"some" markets will be down on the day, well that is a no lose proposition as most will.

WEIRD WEIRD STUFF

The markets today are wierder than ever and maybe giving some gifts. The DJIA is higher by 76, NAZ lower by 7, IWM -.5%, QQQQ lower by 10 cents, OIH lower earlier by more than 4 bucks and is now almost unchanged, Gold and Silver are crushed and the XAU and the HUI are both lower by about 5%.

On realmoney.com Jimmy is bullish on the metal stocks and I quote:


"Pause that refreshes in minerals and mining? I think so. I think the swoon will last a couple of days and then start all over.

My confidence is based on bizarre stories like the hoarding of gold in Iran, or the max-out by OPEC, or the fact that China is in the U.S. right now basically to say, "We are going to take your jobs away and make more things than you would ever believe, and those things need aluminum and zinc and copper."

Sure wish they would mean glass, as in Corning (GLW:NYSE - commentary - research - Cramer's Take), but they are still too underdeveloped to go there.

Meanwhile, let the other stocks have their day. Let the leadership broaden.
The minerals story is an unfortunate one. Every time they go up, we can expect to hear the talking heads talk about inflation. The reason that is unfortunate, though, is that the real rate of stuff we need, other than gasoline, isn't going up. Food, clothing, rents, homes -- they aren't going up. And despite Nissan's admonitions, the price of a car isn't going up, either.
That's why I remain bullish on this market, and want to buy weakness in minerals whenever I can find it. "

I think Jimmy is on to something here and I agree, buy the pullbacks in metals. Bull commodity markets generally last 10 or 15 years so my bet is that we are still early in the cycle and I will be scaling into metal stocks starting today.

TECHNICALS -SSRI

The metals are getting crushed today and the silver stocks are taking the brunt of the punishment. So is today a day to buy SSRI? I suspect so and I have dipped a toe in to buy some for the longer term. I think the saying is that the most vicious pullbacks come in bull markets or something similar. Today is one ugly pullback. PAAS is another silver stock that is getting crushed so take your pick as I doubt that the bull market in metals ends today.

The markets and the SPY in general is having one of the most volatile day seen in weeks or even months. In the first hour of trading the ETF traded in a 1.26 range. Another saying is that markets get very volatile prior to changing directions(hmmm).

The market internals are still over 1,500 to the red and I suspect a down day on the SPY and I am doing little. The Semis (INTC) and Drugs(SGP) are green while Oils, Metals and Internets (HHH) are getting crushed. Note the Russell Small Cap index is down over 1% despite the Pisani "we are close to 5 year highs" commentary. I stress to watch the internals for market direction.

DUMB AND DUMB

Well that certainly was wrong. The DJIA is up 75, the NAZ is red and the SPX is +5.5. The internals are still red by 530 so I still expect a selloff. The techs and the semis are the leaders while the laggards are brokers and yikes the OIH is down $3.7. The day is far from over and do not be surprised if all the indexes including the dopey DJIA closes red.
Pisani talking about a stealth rally this morning and that DJIA is only 400 points from all time high. Hey bob, wake me when the NAZ is at all time high (lol).

OPENING EYES

The Indexes have opened mixed with the NAZ lower and DJIA higher. HOWEVER, the market internals are telling quite a different story with 1,000 more losers than winners. Generally they are the best tell of all and therefore do not be surprised by an upcoming selloff.

The 10 year Bond is back over 5.03% and the homies are taking the brunt of the rising rate trade. The recent winning sectors of Oils and Metals are both lower this morning with tech titans GOOG and AAPL trading higher. The beaten down INTC is trading up a nickel in the face of last nights earnings "miss."

The Pivot on the SPY today is the 130.75 area and support and resistance are 130.4 and 131.3. The market internals are giving me pause and I probably will not buy if the pivot point is hit. I will probably spend the day on the sidelines unless the internals start to flip nearer the greenside and as a final note, why am I listening to chinese on tv?

ARMS TAKE

Dick Arms, the noted market technician, with an indicator named after him, is a bit cautious this morning based on his comments on realmoney.com. His overbought indicators coincide with my VIX stretch and 2 day RSI sell signals. I am not sure what he sees that indicates the rally is falling but here is what he says:

"The Dow industrials' rise of almost 200 points, combined with the intraday high Wednesday, took the Dow almost to the level I had expected to be a logical stopping point for a rally, the highs of March. In two days, the market accomplished what I had thought would take a couple of weeks or more.

I am bothered by the fact that the five-day moving average of the Arms Index is now at a very overbought level of 0.78 and that the 10-day is at a moderately overbought 0.92. Two days ago I was short-term bullish, but longer-term bearish. The sudden rally, which appears to be failing and is up against resistance, is forcing me to switch back to a much more cautious stance, even on a short-term basis."

BOTTOM IN?

Jim Cramer came out yesterday afternoon with some INTC comments. Knowing what we know about Jim, and his uncanny ability to be the quintessential contra indicator, is the bottom now in on INTC? I quote:

"But Intel? I don't see the hope. I don't know what gets it out of the doldrums. A PC pickup? I don't think that's in the cards. More demand? I have to tell you, this is the only company I follow that saw weaker demand in Europe in Asia.

That's quite a feat, because I follow a lot of companies. Plus, being levered to PCs just doesn't cut it anymore. Not when gadget tech or big-screen tech or video-on-demand tech's got great momentum. Let me put it another way. If you really think that Intel is good, that it won't have to initiate a price war, that business is solid, then I would go buy AMD (AMD:NYSE - commentary - research - Cramer's Take)! It's got the better momentum, the better customer base and the cheaper chips! Otherwise, let Intel rally to $20, and then sell it again. "

So its late April and Jimmy is bearish on INTC under 20. Of course in January he had this to say about INTC and I quote again:

"Will this be the year that Intel gets its mojo back? I believe it will be. Intel will have the plants and the demand, but it also has pesky AMD (AMD:NYSE - commentary - research - Cramer's Take) eating its lunch because the paranoids at the top are all retired or dead, I guess. Intel is a quandary, a not-expensive growth stock that needs to buy Qualcomm (QCOM:Nasdaq - commentary - research - Cramer's Take) or Broadcom (BRCM:Nasdaq - commentary - research - Cramer's Take) but failed to do so when they were cheap. I'd pay 19 times the $1.65 I believe Intel can earn, and I can see the stock trading up to $31 -- I know, not exciting, but that's what happens when you make your bed with WiFi and let your darned opponent catch up to you in price and public relations. I miss former AMD CEO Jerry Sanders; he always could be counted on to mess up AMD when it most counted. Bring him back, and Intel goes to $40. "

I doubt that there is much more bad news in INTC that we don't know about. The company sells at 16 times earnings, has an ROE of 23%, sells at 3 times book, 3 times sales and yields over 2%. My guess is that it is worth a shot here as all the bad news is out. If they restructure and cut costs the stock will move up and if a new CEO comes on board (HPQ) more perceived good news and a higher price. The final piece of the puzzle will be a Cramer upgrade when the stock gets to 25(lol).

MORNING LINKS

Over 8,000,000 SOLD

Black Gold!!!

Bush firing Bush!!!

The CIA is Monitoring Blogs!!!

Whose Next?

Some Goooooood News!!!

Bullish Gurus!!!

Financial Calculators for All!!!

Kiplinger's Best Mutual Funds

Taxes at Work!!!

RICH RICHER!!!

More Dave Landry!!!

The Latest on Art Buchwald

Daily Option Report's on Lenny and his DEEEEEEP Options!!!

Trading Lessons from Dr. Brett!!!

Gold Bug!!!

XOM EX!!!

The Reason to Buy Oils!!!

HERB on the Street!!!

Kurt Wolfe on XOM SJT and COP!!!

THE CLOSE

The markets closed near the highs of the day with the SPY ending at about 131. The big winner on the day was the NAZ +15 and the SEMI's +1.5%. The market internals closed about 1,500 to the green and were slanted bullish all day. Big Babys INTC and AAPL are set to report any minute and will no doubt impact the markets tomorrow.

More importantly, in my opinion, the VIX and the VXO are now stretched about 7% from their 10 day SMA's and the book says the markets will have trouble making headway from here. In addition, the 2 day RSI on the SPY is 94, IWM / 97 and QQQQ / 83.

The final point is the giddy sounding anchors on CNBC. Maria all excited about 5 year highs on the NAZ and Pisani noting how well the markets did today in light of yesterdays big ramp. I bet it won't be long before we hear " the market is selling off today as it had a terrific run over the past few days." Making money in the markets is about anticipation and determining where the markets are going and not where they have been.

GENIUS AT WORK

OK, can't help it. What was the last general commentary Jimmy gave us on the market. Yes, correct it was April 12, and what did he say; "Don't Like and Can't Trust this Market" as it closed at the bottom of the SPX range at 1288, 7 days ago and 22 SPX points lower. How is that for market timing. So why do we need to STOP TRADING at 3:30 for his sage advice?
If you want to go back and check realmoney.com columns, you will see he continually is bullish higher and bearish lower. Not a great plan for range bound markets.


Anyhow, the rally came and my bid on SPY was missed by a few pennies so all I could do was watch it gallop higher and break the 131 level. I still have a small position that I plan on selling into the close. I am not keen on INTC and their current fundamentals. My guess is they will have nothing good to say and that will not send the markets higher.

The NAZ Volatility Indexes VXN/QQV are the ones getting pummeled today as they are both down 7%. As I type, the VIX is back down to 11.3 and a little more than 6% below its 10 day SMA. The SPY Pivot for tomorrow looks to be around 130.75 so I see no reason to chase the markets here.

TO THE POINT

This morning's volatility has fallen into a sleep walk this PM as the SPY trades between 130.5 and 130.8. The market internals indicate a rally into the last hour as they are a bullish 600 to the green. I will probably go long the SPY on a dip for a quick day trade flip. The markets are too overbought in my opinion for a long term hold (a few days).

Oil stocks are maintaining their bid as crude trades north of 73. The Semis are up 1% in front of the INTC earnings later tonight and the HHH being led by YHOO is up almost 4%. The brokers continue their unstoppable ramp with JEF leading the way up 8.5% again today.

THE PICTURES

If you look closely, well maybe not that closely, you will see the VIX and the SPY and their correlation. The talking heads are giving us all kinds of reason as to why the markets are not higher today. Inflation looked high on the morning report. Yesterday, the fed comments were less hawkish and the markets rallied and on Monday a fed guy said watch out for inflation. Trading on information like that is not fruitful in my opinion.

I like to trade on the numbers and those numbers are delineated above. Buy when the VIX is overbought and sell when it is oversold. Today it is still oversold and I intend to sell the balance of my ETF's on any afternoon ramp higher. I don't think that buying today, unless it is for a day trade, is a high probability trade.

The SPY Pivot was "touched" at 130.24 (actual pivot is 130.18) and any movement back to that area is probably an "intraday" buy. Initial SPY resistance is the 131.5 area and I doubt we see that area again today(premarket trade was close).

The 10 year Bond is back to 5.05% and it is bringing down the homies. The sectors outperforming are Brokers (JEF+6.5%), Semis(SMH+1%), Internets(HHH+3.25%) and of course the Oils(+1.5%). Not sure I understand the Oil situation with all the CNBC babble about supply and demand. I think all one needs to know is that BRIC countries will be consuming lots more oil in the future and supply is not expanding. What else does one need to know?

OPENING LOOK

The markets are opening higher with 900 more winners than losers. The SPX futures were higher by 5 before the inflation news came and they suddenly flipped the switch and traded back to unchanged. I am sure it had nothing to do with the fact that the DJIA and SPX were up 200 and 23 respectively yesterday and some folks decided to ring the register.

The best performing sectors this AM are Brokers(+1%) and Internets(+3%) . The 10 year Bond has reversed and is now back over 5% at 5.02. The Oils trade mixed but the OIH trades higher by 50 cents and XLE trades lower by 30 cents. Be aware that the inventory numbers come out at 10:30.

The SPY Pivot Point, which was not hit yesterday, is the 130.15 level and the initial resistance is 131.50. It is unusual for the pivot not to get hit two days in a row(food for thought).

BREAKOUT OR RANGE BOUND

So is todays action the beginning of a move higher or just the top of the same old range? Those that have been playing the moves higher as breakouts have not been faring very well. I have been buying pullbacks as I have mentioned repeatedly and it has worked very very well. I prefer to buy the market lower and sell it into spikes like today. Don't know if it will keep working but for now if it isn't broke I will not try to fix it.

I do not have a chart of the QQQQ up but I do know that it hit its high for the year on January 11, so that breakout trade did not work that well either (lol).

All of my indicators are in the "get out of the markets" mode with the 2 day RSI on SPY at 93 and the VIX and VXO stretched 5% below their 10 day SMA's.

According to the book How Markets Really Work by Larry Connors;

"When the VIX closes more than 5% below its 10 day SMA, the market has greatly underperformed the averages. In fact, in some cases the market has lost money over the short term. This finding is extremely significant because it identifies the times when the least amount of money has been made over the past 14 years (1990-2003). For example, over the 14 year period, the VIX has closed 5% under its 10 day SMA approximately 25% of the time. The SPX rose over 300% over this 14 year period but none of the cumulative net weekly gains have occurred while the VIX closed 5% under its 10 day SMA." BUYER BEWARE!!!

OUT FOR A RIDE

I will be leaving a bit early for the first bike ride of the year. No, it doesn't look like that in Chappaqua or on my bike route but it is a nice picture. I was hoping the rooster(Cramer) would come out and say the market looks great and get my official sell signal but no such luck yet.

The SPY is now ripping up near 131, which has been the top of the trading range for weeks. The SPY 2 day RSI is back to 93 plus and the VIX is down to 11.55, near the low end of the range and about 5% below its 10 day SMA. The rule book says the market rarely makes northerly progress when the VIX is stretched more than 5% below its 10 day SMA so I continue to sell.

Then again the book said that the DJIA doesn't go up more than 150 in a day or the SPX up more than 15. They are now +200 and 23 respectively. BULLS BEARS and PIGS?

BULL TODAY BEAR YESTERDAY

The bull is running wild today with all the fed stuff (funny how yesterday it was bearish) and the SPY has ripped to over 130.6. I have sold just about a third of mine and will probably dump the rest into the balance of the afternoon. Why? well the 2 day RSI has now shot up to over 90 which is usually a pretty good sell signal and the VIX and VXO are plummeting with both now under their 10 day SMA. As a matter of fact the VXO is down almost 10% and the VIX is down over 6% on the day. BUY LOWER SELL HIGHER.

The market internals, which were a great tell early this morning have now ripped to 3,000 more winners than losers and the best performing sectors are the Reits, Cyclicals, Oils and Homies. The 10 year Bond yield has dripped down to 4.97% which is giving the homebuilders the late day lift.

MORE SILVER STANDARD

How about that weekly chart on SSRI. White lightening has been on a tear lately as it has broken the $13 level and the stocks have followed suit. This one, is a slow mover but as I mentioned back in early April, is one of the favorites of Laurie over at minyanville.com. He has been great with his pick's and I will continue to add to this one on the dips. Also, I have a sneaky suspicion that gold may see $700 and silver may see $15 before the end of the year.

NOON TIME REHASH

I have just sold some of my SPY into the Fed Speak ramp-SPY 129.78. I know this is not the high of the day, but the DJIA is up 145 and SPX +15 and I can tell you that it is very unusual for the DJIA to go up more than 150 or for the SPX to go up more than 15 in a day. Also, SPY second resistance today is the 130 area so it seems like a good place to start selling. In addition, I anticipate any hour now that this guy on the left will come out yapping about how he loves the market here. If anyone has been paying close attention, it is obvious he loves em higher and hates em lower and usually he is a very good tell on when to buy and sell. I direct any non believer to the April 3 call of "12 reasons to love the market" and the more recent World has not Imploded.

11:00 UPDATE

The markets are acting very well today with the best tell of all, the internals solidly green with almost 1,800 more winners than losers.

The best performing sectors are the Cyclicals, Reits, Retailers, Oils, Metals and Semiconductors. The VIX is down 1% to 12.45, but is still trading a few percentage points above its 10 day SMA indicating this rally may have some legs up to the SPY 130 area.

UNH continues to be a house of pain as it trades under 50. MS and JEF, my two brokerage plays, are acting well as GS for whatever reason takes a breather and is only up a dime. MER is lower on what were thought to be excellent numbers and Lenny's INTC continues to drift lower at 19.04.

My take is that if the market internals hold at these levels the play of the day will be to buy the pullbacks as we probably get an afternoon lift higher.

OUT OF THE GATE

The markets open higher with the internals off to the races with 1,900 (very bullish) more winners than losers. The brokers are leading the way with HO-GAN's employer JEF up 6.4% to 66+ after reporting excellent numbers. Just about every other sector is higher with the Homies notably in the red. The 10 year Bond is helping equities with the rate down to 4.98%. Retail, Oils, Metals and Techs all up at least .5%.

The NAZ and the SPX are both up 1/2% and the initial resistance area on the SPY is the 129.3 level and second resistance is at the 130 area. TRADING RANGE ANYONE?

HIBB - CRAMER PICK

Back on March 23, Jimmy on Mad Money made the selection of Hibbett Sporting Goods. The stock was then trading over 33 but has since pulled back to the 30 area and I think it is an attractive play. HIBB is expected to earn 1.08 for the current year and 1.3 for the following year and revenues are growing with expectations of $510 million for the current year and $580 for the following year. IBD gives the stock a 93 EPS rating and a 76 RS rank. Based upon my homework, the company has plenty of room for future growth and may be a terrific play for many years.

BETTER LATE THAN NEVER

My tech guy helped me with a few glitches this PM, so I can now get my final post of the day out of the way.

The SPY closed at 128.66, a whole nickel lower than it closed at on Friday, but it had lots of gyrations in between as it hit a high of 129.31 and a low of 128.02. The internals also recovered from the intraday lows to 1,000 more losers than gainers. It had been as bad as 1,750 more losers. Remember, according to bubblevision (CNBC), the final sixty minutes is the most important trading hour of the day.

More importantly, the SPY did give a midday buy signal and the markets bounced off the oversold 2 day RSI readings of 9. The Volatility Sisters helped in the fight by also getting to near stretched levels of 9% above 10 SMA on the VXO.

The metals, oils and brokers were all higher with the standard gold indexes; XAU and HUI up about 4%. Technology stocks underperformed and that is certaintly not helping the bullish scenario. Tech stocks may be due for a bounce and will probably get one if there is any good earnings news in the next few days.

The SPY pivot for tomorrow is on the close and the support and resistance areas are also todays lows and highs.

NAILS

The bear is hanging tough today with 1,600 more losers than winners and most sectors including technology stocks selling down. Retailers, internets and semiconductor stocks are leading the groups lower and Oils and Metals are of course higher. The market is getting oversold here and I anticipate taking buy signals at the end of the day on SPY as the 2 day RSI is now back under 10.

Some interesting facts are coming to light. Buy and hold for 2006, not so great as the SPX and the NDX now both show gains of about 2.6% for the year. Take note that the high of the year on the QQQQ was on January 11. Lots of churning since then but primarily lower. Picking stocks/sectors in 2006 as well as buying lower and selling higher has been the way to go as Oils and Golds/Silver have led the markets. SSRI PAAS both up about 40% and the OIH Oil service sector is up about 19% on the year. The GLD, the gold tracking ETF, started the year in the 51 area and is now over 61.

Lenny's(see above) favorite deep in the money call play, INTC, is down about 25% on the year as it barely hangs on to the 19 level. One of last years favorites, AAPL, is down about 10% on the year and SMH, the SOX ETF is now trading down about 2% on the year. MSFT, a buy the big cap tech favorite at the start of the year trades at the 26.8 level all the way up from 26.15 on December 30. GS started the year a hair under 128 and is now solidly over 160 and the brokerage index, XBD, started the year at 196 and now trades over 231.

GROWLING BEAR

So the fed guy Michael Moskow opens his yap about inflation becoming a problem and the equity markets are taking it on the chin. Never sure why these guys go on these speaking tours, but they do move the markets.

There are now 1,600 more losers than winners and GS(immune to fed speak) is now only up 2 bucks. The other brokerage stocks are all higher led by JEF and BSC.

The SPY has traded down and thru the daily support area of 128.25 and may be getting to a buyable level. The 2 day RSI has also broken to the 10 level and the VIX is back to 13 which is about 8% above its 10 day SMA.

Adding to the ugliness of the day, the Red Sox just beat the Mariners on a walk off homerun. UGH.

ALL ABOUT THE GOLDS (BLACK and YELLOW)

The markets continue to sell off after hitting their highs at SPY Resistance of 129.2 earlier this morning. The market internals have flipped to 600 red and the Pivot of 128.75 is back in play.

The metals(+3%+) and the oils(+1.5%) are both hitting new highs in todays trade and the brokers are having a banner day as GS JEF BSC LEH MER continue to confound the shorts and the skeptics.

The Volatility Indexes are a tad higher coming off the recess but have not given any new buy or sell signals in a while. The VIX at the 12.65 area is about 5% above the 10 day SMA and the book says ETF's are not to be sold when the VIX is at those levels. The 2 day RSI of SPY is now around 17 also indicating that a buy signal may be close.

BOOYAH JIM, BOOYAH

I saw this morning that BKHM guided lower and is now down about 25% on the day. For those with little short term memory, this little telco stock was recommended by Cramer on February 1, when the stock closed at 6.96. The next day the stock gapped higher and traded between 7.80 and 8.49. The website that I often mention that tracks Jimmy's picks uses the 4:00 price of 6.96 on the day of mention as the cost basis. Obviously not much solace to the folks who loaded the boat in the afterhours or bought the next day. Hopefully Jimmy will tell us what to do with this one on Stop Trading at 3:30 or tonight on MadMoney.

Since the site started tracking Jimmy, he has made 722 stock selections. Obviously, no one can buy all the picks, but how does one decide which ones to buy? Do your homework on 722 stocks? Seems a bit silly.

TECH / FUNDY/LONG TERM - UNH

Jeff Saut of Minyanville.com and Raymond James, mentioned this morning that his healthcare analyst, John Ransom, said "Healthcare is on sale and United Healthcare (UNH) is probably as good a name as any."

Homework on UNH indicates that it trades at about 15/16x next years earnings estimate of $3.4. Revenues are growing at 14% and earnings at 16%. The stock is now down about 25% from its December highs.

THE OPEN

The markets are higher out of the gate led by the Oils(+1%) and the Metals(+2.5%). VLO is leading the refiners higher as it hits another new 52 week high. The brokers (+.5%)GS +2, SOX (+.4%), GOOG+3, MSH (+.5%) are the winning sectors and there are not many meaningful losers.

INFY(+10%) SAY(+6%) CTSH(+3.5%) all continue to rip higher on the INFY earnings release from last Friday.

Market internals are 450 to the green and the SPY is higher by 30 cents. The Pivot Point today on the SPY is 128.75 and hopefully it stays in the rear view mirror. Resistance on SPY is 129.2 and double resistance is 129.7.

The Volatility Sisters are moderately higher after the 3 day vacation.

PRE OPEN LOOK

Highlights this morning; we find oil trying to bust through the 70 level , gold(600 in the rear view mirror) and silver a teenager (13+) all ripping higher on the talk of more global (Iran) tensions. The futures are pointing to a flat open on the equity markets and the 10 year Bond is now trading down to 5.02%.

INFY reported good numbers last Friday and the Indian outsourcing stocks are higher off the good news. SAY +4.3%, INFY+5.4% and CTSH+2.3%.