IBM Technical Breakout

There used to be a saying, "As IBM goes, so goes the market." Not too many people pay attention to America's long standing Blue Chip stock anymore. "Big Blue" as it used to be called just closed at a ten-year technical breakout high. Let me repeat: IBM has broken above its TEN YEAR high! From a historical and technical perspective we can expect the overall market to follow suit. This move appears even more impressive if we look at IBM's history over the past two years. The stock was trading at just around $75 in late 2008 and has now almost doubled!

Over the years it has been speculated that if someone wanted to manipulate the Dow Jones Index, they would buy or sell IBM as it holds alot of influence over the Dow index. Whether it is the Fed, speculators, or the market as a whole, Big Blue still retains much influence over this important index. Those who follow tech stocks should take note of this too.

Short term this is a good opportunity to take some profits in Big Blue, or play the put-side as there will probably be some pullback in this stock as options expiration approaches. But from a longer-term perspective, we can expect a general move higher.

Marketdoc has put positions in IBM.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment should be reviewed by your own personal investment advisor.

Expect A Market Pattern Resolution Soon

Since April we have been watching the market establish a solid intermediate trading range. The combination of good news one day, bad news the next day, has not swayed the market in any single direction. The above chart shows a narrowing of the Bollinger Bands between 11,100 and about 9,700. As these Bands move closer and closer together we can expect a significant move in either direction. Much like a spring that keeps coiling and has tremendous stored energy that is waiting to be released.

Typically, September is the worst month for market performance. If we break below our support level we will see a re-test of our long term low from March 2009. Don't be fooled by a brief break below support then a powerful reversal such as what we saw back in 2009. The market may briefly dip below support just long enough to cause panic before it rebounds explosively to the upside. There is still alot of fear in the market which tells me we will probably resolve to the upside. Corporate profits are very good. Even all of the "bad news" has not caused us to break below these intermediate support levels.

Many so-called experts are still focusing on the jobs numbers. Historically jobs have been lagging indicators to the health of our economy. It is like driving your car by looking through the rear view mirror. If thats what they want to do, who am I to tell them otherwise?

What DOES concern me about this economy is that historically our manufacturing capacity is what has led the way out of recession. As factory orders increase, people are called back to work. This increase in economic activity makes its way through the economy as workers start to spend their income and buy those items which they have been putting off until later. (This was part of the trickle-down effect that the Keynesians and Socialists in Washington don't want us to know about.) However, with so many manufacturing jobs exported beyond our shores, this cycle may take longer to complete. We have a significantly smaller manufacturing infrastructure compared to what we had in 1980. I am not sure if a service-driven economy can do this very well.


The fall season should make for some interesting trading opportunities. We have been telling our readers that now is the time to pick up those companies which you did not want to chase last year.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment should be reviewed by your own personal financial advisor.

Dow Retest of Intermediate Lows

This past week saw another continued wave of selling over all of the major market indices. Even gold, that time tested commodity, could not help but to end the week lower.

The above graph shows Dow support at around 9600. Any breach below this level means we will then test the March 2009 lows. Resistance is around 11900. Of course, many of the indicators show we are approaching over sold levels. These are technical market indicators which means almost anything can still happen. There is still alot of fear in the marketplace with respect to jobs, the economy, nationalization of our health care system, natural disasters, man-made disasters. Markets typically do not crash in summer months NOR when there is so much fear to go around. The sellers typically exhaust themselves over a period of time and the market rebounds.

We have been saying for months now is the time to pick up those companies which you didn't want to chase last year.

Note: The above is for information purposes only. Any decision to buy, sell or hold a specific investment should be reviewed by your own portfolio manager.

Happy Fourth of July

Fireworks are a common tradition when celebrating the July 4th holiday.


For over two hundred years the United States has stood as a beacon of light, hope, and freedom for the rest of the world. This so-called "experiment" of people actually governing themselves has withstood the test of time. This idea of democracy was unheard of when it was implemented by a handful of business professionals and ministers when they announced the Declaration of Independence to the rest of the world in July, 1776. We were the outcasts nobody wanted. Wars, civil unrest, culteral revolutions, recession, and depressions have come, gone, and returned again. Our nation remains.

Is our nation perfect? Of course not. But we are still the best nation on earth. If you doubt this answer then simply ask yourself: For what other nation do multitudes of people continue to risk their lives just to cross our borders to live here?

Our strength is in our diversity. Our weakness is in our diversity. Over the years Americans have pulled together through the tough times. We will do it again and again. It is when we are not united as a people that we are weak. Feelings of hatred, bigotry, prejudice, injustice all serve to divide us. Our enemies know this so they strive to perpetuate this even in our own midst. Yet, our enemies secretly long for the freedoms which they see us have.

Let us not forget our heritage, especially this year. Let us not forget our Creator, as mentioned by our forefathers in their (our) Declaration to the rest of the world. Many will say times are tough this year. We as a nation will rise above it and overcome. It is what we do as Americans. We have done it before. We will do it again.

Happy Fourth of July. And God bless the United States of America.

Bank Index Showing Signs of Consolidation

Many cross-currents remain in this market. One can argue there are no "new" reports of good or bad news, only new "perceptions" of mostly bad news. The economy continues to strengthen but today's housing starts number disappointed many. The Fed's decision to hold rates where they are rattled some investors. The fear is that this recovery is not proceeding as expected. When does the economic cycle ever proceed totally as planned? Never. Although the cycle remains, there continues to be an element of uncertainty, either to the upside or downside. This is how the cycle operates.

The above chart illustrates the Bank Stock Index (BKX.X) shows signs of consolidation. The banking industry has been pummeled during this last recession. It continues to encounter tremendous resistance due to the fiscal problems in Europe. For the most part the U.S. bank exposure to these problems is minimal. More importantly, for this market to put together any kind of meaningful rally the bank stocks must participate. Although the doomsayers continue to their negative predictions, the Bank Index continues to show signs of life. This is exactly where a bullish perspective would place it. Now is the time to pick up those bank stocks which you did not want to chase during the last rally. Keep an eye on the present support line. If it is violated things could get quite a bit more interesting.

Of course, Washington could announce some boneheaded-type legislation aimed at "protecting us from the banks." This would send the market spiraling downward. For now, they are preoccupied with their own public relations problem handling the Gulf Shore oil leak and internal personnel changes.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specif investment should be reviewed by your own investment advisor.

Descending Wedge Breakout for Dow Industrials

The above chart shows the weekly Dow Jones Industrial Average has successfully broken out of its descending wedge pattern. For weeks the Marketdoc Report has been pointing to the numerous buying opportunities which exist in the market. The market appears ready to challenge its 200-day moving average of 10,477. The strength at which it moves above the 200-day average will determine the strength of the next leg upwards.

The past few weeks have shown another stream of negative news for the market. Most of the news was "old news" such as the situation in Europe, but the perception was extremely negative. Hence, the market sold off. It is highly suspected that investors were short of cash and needed to sell some of their holdings, others were just skittish, and some wanted to take profits. Regardless of the reason, we have seen another classic descending wedge pattern with its subsequent breakout. Selling volume seems to be getting exhausted.

The fundamental news about our domestic economy continues to be relatively good. We are in an early recovery phase. Don't listen to the self-proclaimed experts who keep pointing to unemployment numbers. Unemployment is a LAGGING economic indicator. When a string of unemployment numbers are decreasing is when most investors should be SELLING into rallies. For now, the market appears headed higher. Can something unexpected happen? Of course, including a possible cluster-flop legislation which can come out of Washington at anytime. Washington is our "Sword of Damocles" for this market. For now it seems good that Washington cannot seem to agree on anything for very long.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment should be reviewed by your own personal investment advisor.

Chicago Welcomes Lord Stanley

Captain Jonathan Toews accepts the Stanley Cup on behalf of his team


Last night, to a full house in Philadelphia, the Chicago Blackhawks beat the Philadelphia Flyers 4-3 in overtime, to clinch the prized Cup in one of the most exciting Stanley Cup Final playoff games in the history of professional hockey. Both teams played their hearts out but Chicago gained the victory when Patrick Kane scored "the goal that almost nobody saw" at 4 minutes 6 seconds in overtime. Kane's quick wrist shot went between the legs of Philadelpia goalie Michael Leighton. The puck became lodged in the netting and only a few players and onlookers were aware the goal was scored. The play was reviewed to be sure the puck actually went in. Both goal tenders played superbly. Chicago's Antti Niemi stopped a third period onslaught by Philadelphia as they attempted to gain victory and send the playoff series back to Chicago for a seventh, all-deciding game. The game was the most widely watched Stanley Cup Final game since 1974.

The Stanley Cup was donated as a trophy in 1892 by then Governor of Canada, Lord Stanley of Preston. It has a long tradition of passing on to those hockey teams who find themselves worthy of this cherished prize by winning a series of playoff elimination rounds. It was originally awarded to the Montreal Hockey Club in 1893 "after defeating all comers of the late season including the Ontario Hockey Club." It is said that Lord Stanley purchased a punch bowl made of pure Silver in Sheffield, England, for about 10 guineas (about $1,175 in today's US dollars.) The Cup has since been passed on year-after-year to the new champions. The names of each player of every winning team are inscribed on the Cup. Several additions have been made over the years to accommodate all of the names. There are actually three "official" Stanley Cups- The original purchased by Lord Stanley, the Presentation Cup which is the one actually presented to teams each year, and a Replica Trophy to be used as a stand-in at the Hockey Hall of Fame.

There is much significance to the Chicago Blackhawks winning the Cup this year. It is Chicago's first Cup since 1961, for a total three times winning the Cup. Its first Stanley Cup championship was in 1938. The team has recently come under control of William Rockwell "Rocky" Wirtz, grandson to the late owner Arthur M. Wirtz. Rocky breathed life into this dying franchise. Himself, an avid hockey fan, Rocky welcomed all of the former players back to the ice arena where they had been previously told they were not welcome. He held a series of promotions for the hockey franchise. He made the fans and the team feel good about itself once again. This most recent Stanley Cup championship team is one of the youngest teams in the hockey league this year. The team was cheered all season by the Blackhawk's oldest living player, Al Suomi, 96, who played for the team in the 1936-37 season. It is believed Mr. Suomi is the oldest surviving NHL player.

Chicagoans have much to celebrate in their team's victory this year. To the city, the fans, the organization, Mr. Wirtz, and the players-- Congratulations!

Uncertainty Continues... Market at Crossroads

Once again we saw the Dow Jones Industrial Average test its lows for the year at the all important 10,000 level. Why is it so important? This level is a key psychological level in the market. It is also an intermediate support level.

We have been covering this uncertainty for several weeks now. Uncertainty-breeds- volatility-which-breeds-opportunity. Could the market go lower? Of course, but when everyone expects a crash is when one WILL NOT HAPPEN. If this were September/October things would be less sure. However, it is rare for the market to collapse during this time of year. Some of our indicators show the market can go lower. Others are showing an oversold bias. What we are seeing is a crisis of confidence in the markets, mostly over the European situation. I suspect many investors may be cash-strapped right now and this may have been causing some of the selling lately. All they need is an excuse for more selling. Our domestic economic fundamentals remain sound and show continued economic recovery.

There are several buying opportunities which remain. Now is the time to pick up some of those companies which you didn't want to chase last year.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment for a portfoloio should be reviewed by your personal investment advisor.

Memorial Day 2010- Remember Our Fallen Heroes

Residents in Southwest Florida hold a Memorial Day ceremony.


Ever wonder why veterans sell poppies for donations so close to Memorial Day? It is because of a popular poem entitled, "In Flanders Fields" written by a Canadian physician and Lieutenant Colonel John McCrae in May, 1915. McCrae was a surgeon in charge of a field hospital during the second battle of Ypres during World War I. McCrae wrote the poem after his friend, and former student, Lieutenant Alexis Helmer, age 22, was killed in battle. He noticed the poppies flourished over the disturbed earth of the battlefield days later. The term "Flanders fields" is a geographic region which includes parts of Belgium, France, and the Netherlands. McCrae wrote:
"In Flanders fields the poppies grow
Between the crosses, row on row,
That mark our place; and in the sky
The larks, still bravely singing, fly
Scarce heard amid the guns below.

We are the Dead. Short days ago
We lived, felt dawn, saw sunset glow,
Loved, and were loved, and now we lie
In Flanders fields.

Take up our quarrel with the foe:
To you from failing hands we throw
The torch; be yours to hold it high.
If ye break faith with us who die
We shall not sleep, though poppies grow
In Flanders fields."

-Lt.Col. John McCrae, MD, 1915


Formerly known as Decoration Day, this Federal Holiday is a time of remembering those men and women who died in military service. The name was officially changed to Memorial Day in 1967, and is celebrated on the last Monday in May. One of the longest standing traditions with Memorial Day is the running of the Indianapolis 500 which began in 1911. Many visit cemetaries and memorials. Flags are placed on the gravesites of veterans. Parades held. A moment of silence takes place at 3PM local time. Many people recognize Memorial Day as the unofficial beginning of summer.

Please take a few moments this Memorial Day weekend to remember those who have fallen for our country. They paid the ultimate price for the freedom which you and I enjoy. God Bless America!

Buying Opportunities in Uncertain Markets

As we continue to watch the dialogue taking place within the European Union concerning the crisis in Greece, we have seen very volatile action in the markets. The Dow Jones Industrial Average continues to test its intra-day low of May 6th. We saw this index briefly fall below 10,000 during the "flash crash" as it is now being called. Gold is rallying. The Euro is falling. Make no mistake, there is still uncertainty in the markets. But the reasons behind the panic in the markets are over old news. Europe is experiencing a crisis of confidence in their financial system. So far, the U.S. has not directly been involved in this mess. The positive effect of this is that it will continue to keep inflationary pressures in the U.S. under control. The U.S. economy continues to strengthen and looks even better when compared to Europe and the rest of the world. Could this change? Of course.

PERIODS OF UNCERTAINTY IN THE MARKETS ARE GOOD OPPORTUNITIES FOR BUYING!!

Whenever the masses are talking about the market going much lower, it usually will do the opposite. Yes, we did touch many technical support levels during those few minutes of trading on May 6th. And we continue to see volatile trading. But opportunities remain for buying in this market. Now is the time to accumulate those companies which you liked over the past year but didn't want to chase.

The time period May through November is usually a rough time in the market. The addage, "Sell in May, go away" is being played out. When Armageddon finally does arrive, it will find us when we least expect it-- not when everyone is looking for it.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment for a portfolio should be reviewed with your own personal investment advisor.

Classic Panic in the Market (Again)

Today we saw the Dow Jones Industrial Average drop 998 points at the height of what can only be described as a classic panic in the market. The Official reason for this panic is concern about rioting which took place in Athens. The population there is unhappy with proposed measures to help rescue Greece from defaulting on their sovereign debt. Years of socialist spending programs with high taxes have taken their toll on this country known through the centuries for its intellectual enlightenment. Today the masses did not like that their pensions and welfare programs are being cut with even higher tax rates. The world markets responded by massive selloffs. Some speculate there was also a "trading error" at a major securities firm during the height of the selloff. (Side note: There may be a Congressional hearing three years from now investigating this issue to reassure us we are being protected from evil Wall Street.)

This comes at a time when the economic recovery in the U.S. is taking hold. Even the lagging unemployment number looked good today. Last week's Congressional hearings involving Goldman Sachs only helped erode confidence in our financial markets. So far the Greek crisis is limited to their European economic partners. Repeat: SO FAR THIS IS NOT A U.S. PROBLEM. There are many uncertainties in Europe right now besides the Greek crisis. Europeans were already holding their breath waiting for the outcomes of elections scheduled to take place in England and Germany. Markets never like uncertainty.

We are at a crossroads in the market. If uncertainty continues we could see the U.S. and other world stock markets continue to plunge. However, we did see a pretty good bounce off these intra day lows as bargain hunters stepped in. The market typically does not crash when everybody expects it. Regardless what happens in the near-term, we should see a retest of these intra-day lows as many technical indicators were breached today. This sell off could actually be good for the U.S. markets.

Until confidence is restored things could continue to be ugly. This ALWAYS leads to great buying opportunities.

Note: The above is for informational purposes only. Any decision to buy, sell, or hold a specific investment for a portfolio should be reviewed by your own personal investment advisor.

The Goldman Sachs Witch Hunt

Very rarely do I comment on active investigations which are taking place in Washington. However, the current witch hunt, yes, "witch hunt!" that is directed at Goldman Sachs is full of total hypocrisy and a waste of taxpayer money. Congress is supposedly concerned that Goldman participated in unethical trading practices and thus reaped huge profits during the height of our nation's financial crisis. Congress is only now asking questions about what really happened-- almost three years later! They believe they owe it to us, the taxpayers, to "get to the bottom of things" which took place during the biggest financial crisis to hit our country in almost 70 years. Somehow Congress feels that by putting executives at Goldman on national television it will send a message to the voters that they are doing their job.

In fact, Congress was asleep at the wheel as the financial storm clouds were forming. For example, they turned a blind eye as Fannie Mae and Freddie Mac actually encouraged excessive lending practices to low income home buyers throughout the 1990's causing these quasi-government entitites to need to eventually get bailed out by the taxpayer. More than one of the former Board members at Fannie and Freddie are now Presidential Cabinet members or close advisors. Look it up. Where where these Congressional Committees then?

Some important facts are coming out during this present investigation:

1. Congress doesn't have a clue what Goldman actually does. Goldman serves as a market maker in multiple levels of security transactions to help the markets remain liquid. They MUST participate in either side of a buy/sell trade depending on whatever side the counter-party takes. A market-maker buys when others are selling. A market-maker sells when others are buying. By nature of the magnitude of these transactions there is huge risk to the market-maker. They also have the ability to place hedged transactions to help protect each position they take. Congress is somehow alluding that by participating in the other side of transactions, sometimes taking alternate sides in different transactions, this is somehow unethical for a market maker to do.

2. Congress isn't talking about why they selectively let Lehman Brothers to go bankrupt yet they rescued several other financial firms which were ready to go under, but already had buyers. Why this selectivity? The Lehman bankruptcy exacerbated our financial crisis from primarily a mortgage problem to a global financial investment problem. There are reports of many Congressional back-room deals and ultimatums which took place during the height of the crisis. Then they had the audacity to change the rules after TARP money was actually distributed.

3. This witch hunt is also causing much uncertainty in the financial markets at a time when our economy is showing signs of recovery. Markets never like uncertainty and this could cause serious harm at this particular moment in time.

Bottom line: This is nothing more than a dog-and-pony show by Congress to give voters a perception that they are doing something to protect us from the "evil" Wall Street firms. I have one question-- Who is protecting us from Congress?

Bull Market Continues... Dow Approaches 11,000

We can expect to see repeated attempts and eventual success at breaking the 11,000 level on the Dow Jones Industrial Average. This market continues to reflect underlying strength in our economy. This "Silent Bull" continues to rage since early last year. The Bank Stock Index has broken above technical resistance.. a bullish sign but UNDER-REPORTED by the media.

Meanwhile, the "experts" still expect the bottom-to-fall-out. They continue to watch in disbelief. I spoke with a self-proclaimed business owner from New Jersey who was visiting Florida a few months ago. He assured me this economy would "tank.. and the market with it." Here we are almost 1,000 points higher on the Dow and the economy is still picking up steam. Don't confuse inherent market risks with what is actually happening out there. Unemployment is still a LAGGING INDICATOR. Sure, we could see some unforseen event cause shock waves through the market. And some of the Fed Board members are warning us that the Fed may need to raise rates "in the future." But don't let this sidetrack your thinking that this market CAN AND WILL MOVE HIGHER! The 11,000 level is an important psychological and technical level of support/resistance. Remember, this bull market is still a baby compared to other historic moves.

Note: The above is for information purposes only. Any decision to buy, hold, or sell a security for a specific portfolio should be reviewed with your own personal investment advisor.

Bank Index Hits New High

We have been watching the Bank Stock Index (BKX.x) over the past few weeks as it has attempted to break through the high which it set in early 2009. On Friday the Index opened at 50.92, a new high, and proceeded to close lower. The overall market traded with lackluster performance on Friday.

As you can seen this Index remains in an upward trending channel. The confirmation of BKX with the other indices at reaching new highs is a huge sign and mostly went unreported in the media. We should continue to see the overall market move higher based on the technicals. No long-term market rallies can continue without bank stock participation. Surprising enough, this market has rallied for about a year without significant bank stock participation. Looks like the banks will start participating.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment for a portfolio should be reviewed with your own personal investment advisor.

Bank Index at Resistance (Again)

With all of the cross currents in the marketplace today, keep your eye on the Bank Stock Index (BKX.x). The Marketdoc Report has been closely watching this index for several weeks now. This is only one of the few indices that has not challenged and exceeded its highs which were put in place in early 2009. I believe this is what has been weighing on the overall stock market to keep it from moving higher. Yes, there are signs of the economy slowing down. People are afraid of the so-called "double-dip" recession. Many are keeping their eyes on unemployment which is a LAGGING indicator.

But in a slowing economy this could be good for the banking sector as this means the Fed will keep interest rates low as a way to stimulate growth. One might argue that the recent raising of the discount rate was a negative for banks. Banks seldom use the discount window anymore to borrow funds. With the cost of capital still historically at fire sale prices, banks are free to borrow at low cost of capital and add a mark up to ensure they earn a profit.

From a technical stanpoint the BKX is showing signs of exhaustion before making a new yearly high. If we see this index break through resistance it could mean the overall market will EXPLODE to the upside. Keep watching.

Bank Index Ready to Challenge 2009 Highs

The chart above shows the banking index (BKX.x) as it is ready to challenge the established highs from 2009. This index is the ONLY one that has not exceeded its summer highs. A new high in the bank index will be a "green light" for this market to run even higher. Of course, the doom-and-gloomers are waiting for the bottom to fall out. There is a time and place to be cautious and defensive. There are alot of crosswinds right now but the upside bias continues. This market has shown much bouyancy despite the uncertainties which remain. While everyone is focused on unemployment (a lagging indicator) this market, especially the bank index is telegraphing signs it wants to run higher.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment for your portfolio should be reviewed by your own investment advisor.

Gold at Technical Support Levels

The chart above says it all. Gold is testing its technical support levels from mid-last year. Our Marketdoc Report on January 14th called for the breakdown after a Head-and-Shoulders top formation in the CBOE Gold Index. Our target remains around the 150 to 175 level on this index. The market is showing almost no concern about inflation. The dollar is strengthening. The economic recovery continues. Sorry goldbugs, we saw this one coming.

Check out our past issues of the Marketdoc Report. You too can learn to recognize important technical patterns to maximize your trading opportunities!

Gold Testing Support

This week gold continued its slide to test support levels in place since the middle of last year. We may see a "flight to gold" as protection against the rhetoric coming out of Washington to place restrictions on the banking industry. This political rhetoric is taken seriously enough as it may stall our economic recovery. Overall, I believe the decrease in gold is more related to the strengthening dollar. The next few weeks will tell if the slide in gold is only a pause before higher-highs or a reversal of its uptrend.

Around ten years ago gold traded for $250 an ounce and was declared "dead" as an investment by the financial media. No one wanted to buy gold. Now we see an endless loop of commercials urging us to invest in gold. Further evidence the contrarian theory of investing really works.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment for a portfolio should be reviewed with your own personal investment advisor.

Haiti Disaster Effort

Two years ago I did some medical work in Haiti with an organization called Living Water Ministries of the Palm Beaches (LWM) which has a presence established in Northwest Haiti. In partnership with LWM and Vitamins for Life Haiti, we distributed over 80,000 vitamins to three villages over nine days. We actually did a medical clinic there almost two years ago to the the day of the earthquake.

With all of the devastation in Port-au-Prince LWM says they are expecting many to flee to the countryside where conditions are slightly better and where people may have relatives located there. As a result they are anticipating a drain on the food, water, and medical supplies which normally funnel into these villages. With Port-au-Prince devastated, they have lost a major supply route.

LWM is sending 12 sea containers which will be offloaded at a port along the coast, outside of Port-au-Prince. They have the manifests and paperwork channels already set up as they make shipments there regularly. As yet, they are not calling for volunteers as this would probably only add to the strain on limited supplies of food and water. They are taking donations on their website: www.lwmpb.org. Anyone wishing to make donations would be well served to donate to LWM.

The infrastructure prior to the earthquake was sketchy at best. Now it is nonexistent. Many personnel want to rush in to help but right now they may not be able to get alot done until the roads are cleared and some sort of large scale coordination plan is implemented. Much needed supplies are still bottled up at the airport. The seaport in Port-au-Prince is shut down.

There will be a need for volunteers and donations for many months, probably years, in Haiti. Although our initial instinct is to do something NOW, the reality is that help will be needed just as much in 1 - 12 months as it is now.
After hurricane Katrina hit the Mississippi/Louisiana coast many people went immediately to help. Four months after the landfall there was still no medical infrastructure in place, other than the free clinics staffed by volunteers from all over the country.

Think about what you can do now, but also think about what you can do in three months, six months, a year from now. The disaster in Haiti will not end any time soon.

Please pray for the disaster victims and relief workers.

Gold Ready to Break Down

The above chart of the CBOE Gold Index clearly illustrates a "Head and Shoulders Top" formation. This means we can expect gold to decline about the same distance from the right shoulder that we find between the neck and right shoulder. This places the index somewhere around the 150 level which is about a 20% correction in gold. Make no mistake. The run up in gold has more to do with the strength (or weakness) of the U.S. dollar more than anything else. Sure, the goldbugs will disagree with me on this one. However, the U.S. Dollar is inversely correlated with gold. As we continue to see the Dollar "reflate" we will see a decline in gold and other dollar-denominated assets. Sorry, goldbugs, I don't make up the rules.

Note: The above is for informational purposes only. Any decision to buy, sell, or hold a specific investment for your portfolio should be reviewed with your own personal financial advisor.

Watch the Bank Stock Index!!

We have been keeping a close watch over the Bank Stock Index (BKX.x) over these past few months. Each of the major stock indices has exceeded its 12-month high through December 2009. The BKX has yet to participate. The above chart shows that it may be getting ready to challenge its 2009 high.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment for your portfolio should be discussed with your own personal investment advisor.