"Men Bileve Not Lyghtly Hym Whiche Is Knowen For A Lyer"

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William Caxton 1415-1492 (approx.)- Set up the first printing press in England

I began this week thinking that investors would be satisfied by the end of this week if NASDAQ put some distance between it and the 50 DMA and the small caps cleared the 200 DMA (or at least looks like they want to).

So far so good. However, this market brings up the famous tale of “The Boy Who Cried Wolf”. For those unfamiliar, a young lad who is bored calls out several times that his flock of sheep are in danger from a wolf attack, which in turn gets adults to run to the rescue, only to find out there is no wolf. Of course, the adults stop coming to his recue and naturally, the sheep wind up getting attacked by a wolf.

Perhaps, the same allegory applies. The market screams, “Rally to new highs”, then fails once too often. Then finally, the rally comes and few are there to prosper from it.

In the world of rates and FED double talk, Thursday saw them firm just a bit-again; but, the jury is still out. I continue to believe a true market rally will be accompanied by a declining TLT.

In the meantime, one more day before a holiday weekend and expectations are for a slooooow one.

S&P 500 (SPY) Calling 188.70 pivotal. Do you remember when SPY took out 185 back in end of February and the measured move I wrote about was for a target of 220? Stranger things have happened

Russell 2000 (IWM) Will this take out the 200 DMA and hold 111.35?

Dow (DIA) confirmed bullish phase with the 166 next point to clear

Nasdaq (QQQ) 89.41 turned out resistance but more importantly is the distance holding between it and the 50 DMA

XLF (Financials) Tested 22.00 but closed just shy of it-and so, we cry “wolf!”

SMH (Semiconductors) A start and now has to hold 44.87

IYT (Transportation) New high close

IBB (Biotechnology) better and over the 50 DMA so now has to hold and clear 237

XRT (Retail) Another wolf for now

IYR (Real Estate) Maybe running out of energy-and time for a correction-which could be a sign for firmer rates

ITB (US Home Construction) Good move today

GLD still just chopping around sideways near all the moving averages so keep looking

USO (US Oil Fund) Will be interesting to see if this can hold 37.55 now

OIH (Oil Services) Like this better now too

TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs 112.35 the fast moving average-and now pivotal

UUP (Dollar Bull) Bottoming action still in play with 21.50 the elusive resistance