Exposing Ideas to the Envelope of Serendipity

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Friday, May 14, 2010

Heading Out

The beautiful Outerbanks are beckoning, and although departing a day later than originally planned, I'm looking forward to a weekend away. I'll be leaving around noon if all goes according to plan.

The markets continue to be extremely skittish and fragile, exhibiting strong and sudden moves in both directions and along with them plenty of red flags. Bearish charts abound, but so do impressive pockets of resilience, and more information is needed before committing to a strong stance. While Thursday's sell-off was sharp and encouraging for the bears, it also came on the heels of a very strong rally out of the abyss, and occurred right at key resistance levels we've all been monitoring. That could signal an end to the rally, or it could just as easily mark a logical point for a little give-back and consolidation after the run-up. Time will tell, and the wise will wait for confirmation one way or another before over-committing. Precious metals continue to shine, but RSI is in the stratosphere for many stocks in the group suggesting at least a pause may not be far off. Protecting profits is the name of the winning game in periods of high volatility and conflicting or unclear technicals.

Here's the view of the /ES over the past couple of weeks that I'm watching:

That's it for now. Have a good weekend and I will see you Monday.

--  Brinkley
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