Tuesday, June 24, 2008

Are we done correcting? Not yet I'm afraid

Hi there,
and welcome back to RI's S&P 500 blog.

The late spring correction continues as expected. The SPY itself is now down 8.5% from its highs seen just last May 19th at $143.58. As in my previous posts, I fully expect the lows of March 17th, 2008 at $124.82 to be tested in earnest. What is most interesting is how and when this is occurring. Readers of my special report, Opportunity is Now Here, will remember that during typical US Presidential election years, the market does nothing for the first half, then dramatically outperforms for the second. Oil is (in my opinion) topping out, earnings are (in my opinion) starting to bottom out and the political stage is being set for a real showdown in November. Both Obama & McCain shall do anything they can to appeal to voters with regard to energy prices - that can't be oil friendly. Both candidates shall claim to have the appropriate fix for the housing crisis - that should help the financial sector. Even if the rhetoric is perceived as only a short term fix one can see why the market may do better going forward.

Currently the market is trending lower and one ought to remain cautious. As a rational investor though, I do believe we are NEAR an exceptional buying opportunity. Keep waiting patiently.
That's all for this week, enjoy,
Brian Beamish FCSI

Tuesday, June 17, 2008

And the grind goes on

Hi there,
and welcome back to RI's S&P 500 blog.



The old adage of Sell in May and walk away has so far been correct once again. As per my recent blog entries, one ought to expect a test of the $130 area on the SPY over the course of the next few weeks. That test in now underway. Worries over the financial sector and the associated housing crissis will prevent any further upside action for the time being. As well, the parabolic nature of the energy markets will act as both a dampener on economic activity and a stimulant for inflation. See RI's recent report, Opportunities in Options - Is it now time to start building a short position in Energy, for a further look into the potential profits in shorting oil (through the use of long term Put Options).
That's all for this week, enjoy,
Brian Beamish FCSI

Wednesday, June 4, 2008

Looking for a late spring bottom

Hi there,
and welcome back to RI's S&P 500 blog.



The long slow process of correcting is apon us. As I have stated in previous posts, the old adage "Sell in May and walk away" suggests we ought to see some sort of pull back in the major stock indicies over the coming weeks. We are in the midst of that pull back with the SPY off 3% from the highs seen just three weeks ago. I am still looking for a serios test of the 1 year up trend line (at or near $132.50 on the SPY itself). Rocketing higher oil prices, more troubles from the financial sector and now a united Democratic party (behind B. Obama) shall stress the markets for the coming weeks.
Enjoy the show and don't be in a big hurry to buy anything for the time being.
Brian Beamish FCSI