HOW QUICKLY INVESTORS WENT FROM VERY BEARISH TO WILDLY BULLISH

Below is a chart with the Rate of Change applied to bullish sentiment.

You will notice that investors went from very bearish to wildly bullish at the fastest pace in
over 4 1/2 years.

This to me represents a lack of conviction on both sides of the market, which thus translates into uncertainty and we all know how much the market hates uncertainty.

This phenomenon does not bode well for a market that would continue to rally.

Copper - Take Profits

Sell Long Position In Copper for a nice profit.

The market looks confused here and I would rather take the profit and wait then remain in the market during its period of direction searching.

Indecision In The Cocoa Market

We made an average down move yesterday in Cocoa and Sold yet another contract short today as well.

There is some serious uncertainty in the cocoa market and the price pattern looks to have the potential for a monstrous decline.

Equity Market Comment - 09/21/2007

There are still simply too many concerns to overlook in the current condition of equities in order to get intermediate term bullish.

The first is the lack of a re-test of the August 16th low. This is not healthy and is a sign of an emotional low, not a structurally sound low.

The second is the continues lack of participation in this entire move higher from the Mid-August Low as it shown by the chart below.

The third is the very quick back to bullishness amongst market participants. It seems that everybody is expecting a strong rally here.

Fourth, the time frame we are currently in, as it usually leads to either a stall pattern in prices or weakness. While I do not expect a crash, the market could be setting up for an ugly October that may very well see a correction of 15-20%.

Fifth, the price pattern from the lows is most likely in counter trend fashion, which stipulates that the intermediate term trend remains down.

Now, all of these concerns could be rectified if the market is able to test the lows with ideally a 61.8% decline of this most recent rally, so any pullback here (and one does seem eminent) will tell us much about what is to come.

In the meantime, I remain 100% hedged on core positions, but I continue to look for short term trading opportunities on both the long and short side of stocks.

As usual we let the market tell us what it wants to do as it know about 100% more than us.

ISIL - Breakout Candadite

Equity Market Comment 09/20/07

With this swing high we can expect at least some type of decline in here.
The nature of this decline will give us some very valuable clues as to where equity
prices should head next.

Take a look at yesterdays comment for some very interesting revelations.

Equities - A Cause For Some Concern

While I do not subscribe to the current philosophy of a replay to 1987 carried by many, I do have some reservations as to whether or not the low made in mid August at 1370 on the S&P 500 is actually the ultimate low or simply the first leg down.

It is exactly this concern that has made me keep my hedge in place and while the market has been in a rally phase over the last 10 days there is very substantial evidence that this uptrend is at or near its completion.

The concern comes into play with the counter trend rally structure that has formed off the lows.
The price action has not been indicative of a new trend underway and thus sends a warning that the 1370 area on the S&P 500 may be only the first stop in a larger correction.

The key sign we need to look for is a penetration of the .618 retrace level off the lows. If this price level is breached and closed below then the odds increase that 1370 on the S&P 500 will be taken out.

I will be giving more specific price levels in the near future and as of now, the purchasing of new stocks for intermediate term profit has been put on hold.

If you did not take advantage of the last hedge we put in place back in June 2007, then you have another opportunity here to protect your portfolio holdings.

Understand that I am NOT advocating a Crash of any kind, but simply a deeper correction then first anticipated.

Soybeans Into The Action Plan

SHORT SOYBEANS ON A CLOSE BELOW 9.60 BASIS THE NOVEMBER CONTRACT.

ADD TO SHORT COTTON TRADE

NEW COMMODITY TRADES AND ADJUSTMENTS POSTED.

PLEASE CHECK THE OPEN AND CLOSED COMMODITY TRADES LISTING.

AGGRESSIVE EQUITY TRADES

NEW AGGRESSIVE STOCK PURCHASES TODAY WITH KB HOMES THE HIGHLIGHT.

CHECK THE OPEN EQUITY TRADES FOR THE NEW TRADES.

Equity Market Comment - 09/18/2007

Although the market continues to move up, the underlying strength remains highly suspect.

I have yet to get sucked into this rally as all the internals continue to call for a constructive re-test of the lows. Even the internals today for such a large move were very weak.

Keep your powder dry however and do not get sucked into the short term euphoria.

SOYBEANS - On The Watch List For A Short Sale

A strong downside reversal on Tuesday will signal a trend shift in the Soybeans.

Look to go short on any substantial weakness.

COCOA - Near Term Collapse Possible

Cocoa looks to be on the verge of a potential collapse.

On the next negative close, add to the existing short position.

ULTRA AGGRESSIVE PLAY

Here is a stock that has some serious potential to double and in short order.

Please keep in mind that this is a very aggressive play and a tight stop is necessary.

Actually a tight stop is necessary in any trade!

Equity Market Comment - 09/17/2007

Had a productive trading day in the equity markets as we remain short from 1479 and 1480.

I continue to anticipate lower prices to close out the re-test.

Get prepared to enter your buy orders on the stocks that were posted under the Trend Analysis Mutual Fund Post of a few days ago.

Increase Short Position - Ultra Short Term

We have about as close to a perfect set up here on the Ultra Short Term as you will get.

Increase the short position for a potential drubbing into the close.

Low Risk Put Buying Opportunity 09/17/07