Stock Market

It took no less than Uncle Al to remind players that trying
to soft land a maturing economic expansion carries risk. He
focused on weakness in manufacturing and production and to
point out that the economy is not immune from downturn. That
sent the export driven Asian stock markets into a tizzy and
knocked the US market off its smooth running uptrend. Yes, we
saw panic selling on Tues. and on the open today. Yes, there
is evidence of climatic selling. Yes, the SP500 tested important
support around 1380 today and bounced up nicely. Yes, the
market has turned down.

Got to be the first kid on the block to have THE right answer
for the short run? Go for it. Me, I am in no such hurry. I am
content to wait a couple of days for the market to exhaust the
furious bull vs bear fight and stabilize. Let's give everyone
the weekend to sort their thoughts out.

At this point my internal supply / demand indicators suggest
only that a shorter run overextended position is being corrected.
It is a down market, but the work does not suggest yet that it
is a broken market. The fundamental indicators are still tracking
positive, but business risk levels remain elevated as I have
discussed, and the recent sharp downdraft in stock prices indicates
a substantial hit to confidence. Again, my vote is to give everyone a
pass until Monday so we can assess the fragility of the collective
psyche. Too much zigging and zagging right now.