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December 4, 2008

Anomalies

As has been the MO of late, the market gods left us in quite an ambiguous state with regard to market projection, and today's session was full of anomalies. Both the Bank of England and the ECB cut rates sharply... actions that would normally juice the dollar, but the buck was actually down sharply. Perhaps that movement is a clue to the fact that the dollar is, indeed, ready to roll over. A weaker dollar is key to the development of a mid-term rally here, but were stocks up on the buck's weakness? Of course not. The SPX slumped 3%.

index chart

Not only were equities down, but commodities slumped, as well. Gold and silver were off modestly while crude got hit for three bucks. People, oil is trading at $44 per barrel... over one hundred dollars below its peak less than five months ago. Unleaded gas hit 96c on the January contract. Unbelievable.

Anyway, I offer a full refund to anyone coming here this evening looking for an answer to the market's next move. Price pattern tells me down, although it is not supported by volume. My instinct tells me up. My holdings have a slight long-side bias, but there is no way I'm holding any significant delta overnight. Let's hope tomorrow brings some clarity.

 

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