Boy Greenspan sure pooped the party today didn't he?

One comment about China (did someone really need to say that for people to figure it out?) and boom! Rally over!

In the meantime, however, that bond keeps ticking up. I did predict 4.90% this week didn't I? We might get there... we're 4.859% right now...... hmmmm.... and guess what - that ain't good.

In any event I don't think its quite over yet. Why? Short interest. People are still shorting into the rises - bigtime. And they're getting slaughtered the next morning, with some covering - but not net-net. Further, the technical indicators I use to trade off of do not show a rollover - yet. So Mr. Canary is still being chased by the Cat.

A/D was about 2:3 on the S&P500 and a bit worse on the Russell.

If I had to take a guess I'd say we're still likely to see that closing new high, although whether we see it this week or next is an open issue. We may see a 1-2% move downward in the next week or so too, which is likely to be shorted into heavily. Unless there is major technical deterioration first shorting into this will take brass balls as I expect a snap reversal - but one which, given present trends, is not going to hold!

Tomorrow's and Friday's data ought to be interesting.

Oh, Countrywide? Gezus guys. Convertible with some of the proceeds used to buy back shares eh? Nice of you not to mention in the original PR that the "buyback" was actually a "buy out" of an institutional shareholder. Nice not to mention that you probably had your arm twisted (dumping 23m shares on the open market would have hit the price for an easy $5-7 and perhaps more!) Zero shares purchased in the open market by the company. The 8K tells all; this is what people get for trading on press releases, and boy did they. If you were crazy enough to buy into that rally when the PR came out, you were given a gift today in being allowed to bail without losing your ass. Remember - Hogs get slaughtered!

Have a profitable day!