Chart Spotlight

Two charts of somewhat major concern to us are shown below. The financials as you probably know have been under intense pressure for the last year. We thought there was a chance that a bottoming pattern was forming for this sector and Friday’s break of the previous low is not good. Similarly the Nasdaq Composite has broken through to a new four month low and lower prices appear imminent. Several other indices and sectors are at or near support levels and our guess is that these two break downs could lead to a potential significant correction in the coming months. This is a good time to be cautious and vigilant.

Did You Know…

OVERLOAD - As the 78 million individuals defined as “baby boomers” (i.e., persons born between 1946-64) enter their retirement years, an estimated 10,000 Americans a day will become eligible for Social Security benefits over the next 20 years (source: Social Security) Have not heard much about reform lately?.

Final Thought

“When the stock market has this vulnerable look to it, we would rather be wrong holding cash than wrong holding stocks”