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Sep 24

The Market Today

9/24/12

The day started shaky, when a report came out, saying the Iphone 5 did not sell as many smartphones as expected. While this is most likely absurd, it did help bring the market lower. It did not move much lower than from the open, but nonetheless, it was lower. Then following the close, CAT and RHT came out, and lowered guidance. I have not seen what RHT is doing after hours, but CAT was down about $2.25/shr! I thought that a negative guidance would bring a much more severe reaction. Consider what this means! If CAT is guiding lower, this would seem to indicate that the construction boom in China is done, and that the good times are done! This would seem to confirm what the Shanghai market has been doing, which is breaking new lows almost daily. If China hits the hard landing, which it looks like, this could cause the markets here and abroad some pain. China, Japan, ECB, and the US are all easing. This would not be happening if the world was a happy place, and everything was looking great. The fact is, the worldwide economy is going down, and looking like the downside is accelerating. Oil has been declining, indicating a weak economy. Let alone, the problems with Greece, and Spain not seeking a bailout yet. This is an ominous sign. Again, the charts, and the trend right now are favorable. Until the trends break, you need to buy the weakness, and trade it, to make money in this market right now. As soon as the trend changes, once and for all, it will be time to short, and make huge profits at that point!! That is down the road, as I pointed out in Friday’s post, the bullish flag chart is still that way after today, this is bullish. The short term outlook is bullish, intermediate to long, very bearish. This being said, stay tuned…

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