Be careful expecting a rally at this point. There has been to much going on on the sell-side lately to think that this is just going to turn around. Even the better than expected GDP numbers couldn’t bring the rally back. There is not much in the way of good financial news to be expected in the near term and the credit market is getting hammered by more bad news everyday. Credit markets lead equities down and when AAA rated bonds are getting re-rated to BBB junk bonds (never supposed to happen!) that doesn’t bode anything outside of shite for the credit markets.
I’m not expecting more than dead cat bounces in the near term. It’s going down, just a matter of how far or how fast it is going down. Guard yourself on your longs and be watchful of what happens in the Asian and European markets this week. They give good indicators of whether this is a local or global meltdown we are seeing.
