THE MARCH MOVE

I noted selling Calls approaching 1000ET. I'm not ready to get Short big- There are two more days til Options Exp. All the big avgs except DJIA have taken out the Jan highs. SP-500 got close to next target. There is lots of talk of 1200 now - then 1250. Most talkers are now Looking Up. It's been 27 days since the "Extreme Low" on 2/5. The last move up from a similar low was from 11/2/09 to 1/11/10 -- 47 days -- But -that had the added time boost of the Santa Clause Rally. Still - it's on the charts. In Jan - after the 1/11 "Extreme Positive" peak - the big avgs chopped for 5 days before beginning the 18 day correction to 2/5. We are now just a few weeks from start of Q1 Earnings Season. AA reports on 4/12 - per Yahoo. Earnings Warning Season will begin next week or two - just after Options Exp. It seems there will not be a flood of Warnings for Q1. Analysts have been fairly cautious up to now. But - right now - they are getting more positive. That's in tune with the TV Talkers now turning their eyes Upward to 1200 and beyond. I've noticed lots of Targets raised - few lowered. But that's normal in a Bull mkt. We've seen some differences - between 2010 and 2004. Some big. In 2004 - by 3/17 DJIA had already fallen off the High of the 1st Leg - moving toward a little dn-up-dn Low on 3/24/04 . Then came 11 day Rebound Rally into April 6 - Peaked just at the start of Earnings Season. Then mostly sideways into late April -- before down into May. There's a difference in the Fed actions also. By March, 2004 - the Fed had already made noises of tightening ahead. The first of those came in Summer, 2004. In Q1, 2004 - the Housing Boom was in full force in the USA as the Underlying power of the Bull mkt. That was mostly a Domestic thing - with lots of blue collar skilled workers employed to build all those houses and shops. In Q1, 2010 - we are concerned that there may be another Round of Housing price declines - potentially harming American Consumers in both asset wealth - and in Confidence. We now look toward China and other fast growing economies - to take our Exports - as a source of Growth for the USA economy. Ok - some Positives - some Negatives -- as always. Many times - I've discussed the "slam-down" declines - we often get - just before Earnings Season. Those lows help establish a ST floor to trade from - as the bottom of a ST range. In March, 2004 - there was a 3 day dip - after Options Exp week- that put in that "slam down Low" - ahead of Q1 Earnings. 3/24/04 was the end of that Low.
In 2010 - most Avgs are making NH52 during Options Exp week. So the pattern can't unfold just like in 2004. I'll be watching for a dip after Options Exp -- maybe just a PB from the New Highs. Maybe it will devleop into more down -- but that will likely wait till after Q1 Earnings Season- maybe in May. That still leaves us to negotiate the next 2.5 days of this Options Exp week. With Bigs bent on putting in some big Scouts up on the Charts. Since 2/5 - MD Y and IWM have led to the upside. Small and Midcaps. Those avgs - and their ETFs - made signif NH52 already last week - before DJIA NYSE SP500 had reached the Jan highs. DJIA is going last - as it often has in the past. now peeking Over the Jan highs. And -- we are now 2.5 days from Options Exp Day. I'm on the lookout for a Neg reversal any day. I can imagine - if the timing is about right - the decline will be blamed on the Health care bill. If it passes - one idea of blame. If it fails - maybe "sell the news" on the failure -- another kind of blame. We also have lots of new talk of Trade Protectionism. That will be a good "reason" for a decline. But - it's all speculative for now. Stocks are still in Rally mode at the moment.
I noted selling Calls approaching 1000ET. I'm not ready to get Short big- There are two more days til Options Exp. All the big avgs except DJIA have taken out the Jan highs. SP-500 got close to next target. There is lots of talk of 1200 now - then 1250. Most talkers are now Looking Up. It's been 27 days since the "Extreme Low" on 2/5. The last move up from a similar low was from 11/2/09 to 1/11/10 -- 47 days -- But -that had the added time boost of the Santa Clause Rally. Still - it's on the charts. In Jan - after the 1/11 "Extreme Positive" peak - the big avgs chopped for 5 days before beginning the 18 day correction to 2/5. We are now just a few weeks from start of Q1 Earnings Season. AA reports on 4/12 - per Yahoo. Earnings Warning Season will begin next week or two - just after Options Exp. It seems there will not be a flood of Warnings for Q1. Analysts have been fairly cautious up to now. But - right now - they are getting more positive. That's in tune with the TV Talkers now turning their eyes Upward to 1200 and beyond. I've noticed lots of Targets raised - few lowered. But that's normal in a Bull mkt. We've seen some differences - between 2010 and 2004. Some big. In 2004 - by 3/17 DJIA had already fallen off the High of the 1st Leg - moving toward a little dn-up-dn Low on 3/24/04 . Then came 11 day Rebound Rally into April 6 - Peaked just at the start of Earnings Season. Then mostly sideways into late April -- before down into May. There's a difference in the Fed actions also. By March, 2004 - the Fed had already made noises of tightening ahead. The first of those came in Summer, 2004. In Q1, 2004 - the Housing Boom was in full force in the USA as the Underlying power of the Bull mkt. That was mostly a Domestic thing - with lots of blue collar skilled workers employed to build all those houses and shops. In Q1, 2010 - we are concerned that there may be another Round of Housing price declines - potentially harming American Consumers in both asset wealth - and in Confidence. We now look toward China and other fast growing economies - to take our Exports - as a source of Growth for the USA economy. Ok - some Positives - some Negatives -- as always. Many times - I've discussed the "slam-down" declines - we often get - just before Earnings Season. Those lows help establish a ST floor to trade from - as the bottom of a ST range. In March, 2004 - there was a 3 day dip - after Options Exp week- that put in that "slam down Low" - ahead of Q1 Earnings. 3/24/04 was the end of that Low.
In 2010 - most Avgs are making NH52 during Options Exp week. So the pattern can't unfold just like in 2004. I'll be watching for a dip after Options Exp -- maybe just a PB from the New Highs. Maybe it will devleop into more down -- but that will likely wait till after Q1 Earnings Season- maybe in May. That still leaves us to negotiate the next 2.5 days of this Options Exp week. With Bigs bent on putting in some big Scouts up on the Charts. Since 2/5 - MD Y and IWM have led to the upside. Small and Midcaps. Those avgs - and their ETFs - made signif NH52 already last week - before DJIA NYSE SP500 had reached the Jan highs. DJIA is going last - as it often has in the past. now peeking Over the Jan highs. And -- we are now 2.5 days from Options Exp Day. I'm on the lookout for a Neg reversal any day. I can imagine - if the timing is about right - the decline will be blamed on the Health care bill. If it passes - one idea of blame. If it fails - maybe "sell the news" on the failure -- another kind of blame. We also have lots of new talk of Trade Protectionism. That will be a good "reason" for a decline. But - it's all speculative for now. Stocks are still in Rally mode at the moment.