Fed is a Hawk...Right

We are waiting for the Friday jobs’ report but in the mean time we did see some volatile trading today.  In front of the Fed’s minutes, the market was hopeful, anticipating a dovish Fed.  Then the news hit and the minutes were a little more hawkish than the market wanted to see and the market dropped but only to about even on the day.  As the day wore on, the market did head up and finished on a high point but not as high as it was earlier in the session.  Actually the SP500 did finish on the high of the day and the Russell 2000 was close to its high.

It seems that we will need to wait another day before the market gives us a good rally.  Well, the Dow has drawn a line in the sand right around 11,275 last Friday.  If the Dow can get back to that level, then we can see what kind of up move we can get.  The basic idea is that there is now a great deal of, recent, overhead supply and those buyers are “hoping” to get out even if they can.  They have started to consider that they may not and could it be that they may have to sell into the next decline because they are scared?

The next decline will be a very treacherous one that we are trying to avoid, maybe actually profit from.  The reports on the decline are that it will be mild and that it may very well be over already.  We don’t see it quite like that.  The decline is about three weeks old compared to the three years of upside, so we see a protracted decline that will last until fall more than likely.

We did note that silver had a rough day giving back Tuesday’s gain but PAAS has been trying to put in a bottom here this week.  The mining stocks do seem to lead the metal so we are getting intrigued again as PAAS is bucking the metal.  We haven’t done anything as of today but we are definitely starting to think about it.  If the Fed does stop raising rates, then the precious metal complex could have a little spring, something to consider.  

Something else to consider…

BE CAREFUL OUT THERE.

Dow Industrials:  11,168.31  +73.88
RYVNX:   21.45
RYAIX:  23.72
TLT:  83.67
BEGBX:  13.56