The Last Week of July

Here we are again near the end of another month and the market has continued to hold that 10,500 number we have discussed so many times. The longer the market holds, the longer the complacent stay complacent. We still believe in the market being overbought and destined for a fall into the fall.

Last week's announcement by the Chinese to revalue their currency against a basket of currencies should be taken to be an uncertainty in today's markets. Not at the corner of Broad and Wall. There we decided to have one down day to take care of some selling. After all, every dip is a buying opportunity (sarcasm). We see the futures are indeed up this evening and there are a barrelful of earnings coming out this week to entice buyers.

Moving over to the precious metals, we have become a little troubled by their performance lately. The commitment of traders report showed a modest improvement (slightly more bullish) but the trading in the mining stocks has become a little labored. We don't like to see this at this point in the cycle and are becoming more and more inclined to leaning out of our positions. We haven't made up our minds as of tonight but we need to see some upside pretty soon to be fully convinced we are going up.

While we have done fairly well in BGEIX, that doesn't mean we can just sit back and watch it go down. We want to protect our principal in this market including our precious metals/mining positions. We continue to hold for now but we will let you know what we think as the next move develops.

Dow Industrials: 10651.18 +23.41
BGEIX: 11.19