AFTERNOON SWOON

Markets continue to be volatile as the DJIA has already traded in a 180 point range. The RUT/MID complex continue to lag as the big caps take the baton and lose less.

Strongest sectors include utilities, trannies, gaming and drugs while reits, metals, oil service, homies, semis and brokers lag.

Winners include MGM GOOG APOL GRMN CSC GM MCD ABT CMCO AFSI TBSI BTJ FLIR and VIP.

Losers- HDNG FCSX EML SYNL BWLD ME SLB HAL GS BHI KFT BEAS MRVL RIMM NVDA and BRCM.

The VIX is up 8% and now trades at 16% above its 10 day SMA while the 2 day RSI on the big indexes trade in the 10-15 range.

Market internals have flipped to about red 2k on the NYSE/NAZ while the NDX/OEX have also flipped big to about 1 up to every 3 down.

The sub prime mortgages are back on the radar roiling the markets; my take- its a good time to scale in as we come up to the end of the month/end of the quarter and end of the first half. Gains may not appear tomorrow but I am betting this will eventually fall to the rear view and good earnings news will take us back higher as the strategists suddenly realize stocks are on sale yet again.