CLOSING WORRIES

Markets closed near their highs with the madcap/Small cap group leading the way.

Strongest sectors included gaming, airlines, real estate, utilities, my ASCII index (EWE), tyrannies, seams, integrated oils, biotech and small caps. Weakest included oil service GOGH and INTAKE.

Market internals closed very strong with a net 1,400 green on the NYSE and net 920 green on the NAG. The OWES had 85 out of 100 in the green; the NDIS 75 out of 100 green and the SPEC about 380 up to 120 down.

Strong stocks included CSS AFT TWX EPA EXE SANDS ADOBE JUNIPER and GILD while CATS LAMAR MEDIA RIME PATEN HAL and HIPS were weak.

Volatility indexes dipping into overkill territory (again) and trading nearly 15% below their 10 day smash. The 2 day RSI on the DAIS/SPEC/RUT is 86/89 and 87 respectively. Sell signals are there so maybe we get to the 1,415 level. I am not ready to short but cash maybe a good spot at those levels.

And for amusement purposes, please note the following:

The Mid Cap index - year to date +4.4%

The Small Cap index - year to date +.8%

The Big Cap DAIS - year to date -1.4%

The Big Cap OWES (SPEC 100) year to date -2.4%

The Big Cap SPEC 500 year to date -.5%

So, surprisingly all the pundits who have called for big cap outperforming for years are even wrong in a down to choppy market.

Also, check some of my recent value picks, COT FESS BAM and JOE. Lots of value and good real estate and its interesting to see how well they are holding up.

One other note, COMBS yapping all day about the potential end of the supreme crisis. They have got to be kidding; the folks who took out these mortgages at the peak of the bubble (2004/2005) are just getting their rates adjusted (3 year ARMS). So with lots of these loans the "no money down" variety; and with the teaser rate gone and a crummy real estate market why would this be the end of the crisis. Sounds like just the beginning as the folks who have increasing payments and no equity or negative equity tell the lender "take it, its yours."