Weekly Commentary- Positioning for 2010

Last week confirmed the break of the markets across the board. The DJIA closed beneath its critical trend line which has held up until this point since March 2009. As previously stated the rally since March has been nothing more than a bear market rally. With the confirmation of this breakdown Friday...the decline can now continue. Looking back into history shows us that after the crash of 1929, the markets rallied 50% from Nov. 1929- Apr.1930. Most so called market experts, have not experienced a bear market their entire careers...and do not understand the magnitude of its implications. Even the stock market crash of 1987...was a market crash within the confines of a broader bull market. The ideas of buy and hold, buy the dips...etc...are all notions of bull market ideology. If the usual Monday Market levitation is not able to get back at least some of what was lost in the last three trading days...the decline can quickly become main street news. We have the potential to retrace back to 10450 with relative ease however, how far and fast we get back, if at all... will tell the tale of the tape. The next downside target for the DJIA is in the 9600 area. The US dollar will continue to rally throughout 2010 with multiple mini upward retracements along the way. As such, overall commodity prices will decline, in addition to the price of gold and silver. The previously discussed ideas of RSW, DZZ, and UUP should all work out nicely over the coming months of this broader decline. For more aggressive individuals, shorting opportunities abound just about everywhere. For those uncomfortable with trading, the most beneficial strategy would be to sit in cash...and wait for a more opportune entry point back into the markets. Further details and scenarios to follow as time allows...due to necessary preparations for surgery. Questions or comments are welcomed, and can be addressed to me through Neatlysaid.com, via pm-ing, as well as here. Good luck and good trading. -Dio