Asian markets are down a bit and Europe is down across the board so we are in another one of those days where we just hope we don’t go down.
Today is a day I will be watching the Nasdaq very closely and the SOX will lead the Nasdaq which will lead the other indices so not too much to really watch.
I am leaning towards mostly cash as the global situation is still very dicey.
The dollar is collapsing which will either give us a bottom or signal the beginning of the end. I don’t really care what the markets are doing today if the interest rates are kicking over 5.5%.
At 5.5% you have to think there will be plenty of people who will be tempted to move money out of stocks and into long bonds (although I wouldn’t want to make a long-term commitment to dollars right now) which can’t help the markets in general so we will have to start watching rates very closely for the rest of the month.
Gold hit $660 in Europe today and oil is moving back over $72 and copper broke $330 again but hopefully it will top out here for the sake of construction costs. Copper is a waste product of gold mining and, as gold keeps going up, more copper will be dumped on the market as previously unprofitable mines come on-line.
Now Nigerian militants are targeting Chinese oil companies so we can expect oil to only go one way today! We talked about the rumor (confirmed) build in nat gas that drove the price all the way down to $6.50 on Thursday but that sell-off was way overdone and will bear watching as well.
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I’m almost starting to get the feeling that people know something about ABX that I don’t but I still like Jun $32.50s for .65 if gold holds $650.
The PD $90s dropped to .90 but I doubt you can get them for that price this morning but still make a play if copper breaks $333.
HAL $80s for $1.90 may make a nice play following the Valero Rule very closely and oil has to hold $72 for any positive play to work. Watch SLB too!
http://finance.yahoo.com/q/bc?s=HAL&t=3m&l=on&z=m&q=l&c=slb
That’s it! I am that unsure about the markets today…
I still like my GE’s as a falling dollar is good for them, you could argue the same for CAT but they are close to a double from Jan ’05 while GE is 5% under that level.
S still looks good to me as does VZ but I will be giving this week a day or two before I get too excited.
I like AIG $65s for $1.10 but need to be careful of 50 dma at $66. A more risky but more exciting play would be the Nov $70s for $1.85 which will pay nicely if we get a light hurricane season.
