Where are Stocks headed? (6/5/06)

Stocks have sold off in the month of May. There could be a 50% retracement or a Fibonicci retracement going on now. The Fed is still trying to kill inflation by raising interest rates but is still printing money therefore inflation will continue in the long run. The Fed is killing business. The market will start to correct again as business profits start to weaken. The natural thing to do is to buy some puts on the QQQ or the S&P. The Dow will be the most defensive because that is where the big money heads to as a defensive play. So on a relative strength basis the Dow will be the last to break down or breakdown the least amount.


Assigned to category: Stocks
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