neels1126 (74.17)

Start nibbling on longs as SPY approaches 80 level over next 2 days

February 10, 2009 – Comments (0) | RELATED TICKERS: QQQQ , CEF , PST

My initial expectation of bottom by 10th might be delayed by few more days. It will be highly bullish if trasports do not confirm the dow industrials whichare periliously close to breaking Jan lows while QQQQ, IYT, IWM, MDY are 5 to 10% above Jan bottoms. High relative strength of tech stocks is encouraging which has traditionally led the major rallies.

Precious metal stocks are holding well with occasional shakeouts. As one of the few groups with many of the stocks above 50 and 200 day moving averages, they are in intermediate term bull market. Periodically keep taking profits when they are extended and can reenter as they pull back to their 8 day and 21 day moving averages. Base metal stocks are also acting strong..participate via DBB and XLB.

Bonds have peaked..on any significant pullback in prices, establish long positions in TBT (inverse of TLT..30 yr Treasury bond) and PST.