Despite Europe and Asia’s debacle I believe we could be in a bottoming process.
With yesterday’s volatility we are witnessing the rearrangement of positions by momo’ traders and hedge funds.
As you may be aware Bernanke has been busy working the media with a speech at the FDIC Board Conference. In short he will extend the discount window to investment banks possibly into 2009. The last statement of this nature gave hope to the markets and an opportunity to rally.
Also the “beard” said that Fannie and Fredddie will have to raise more capital. Freddie is expected to raise $5 billion+ before the end of the summer. These capital raises along with the avoidance of some accounting rules should help confidence within the market place.
As of right now the markets in Europe are starting to rally back, in part due to the “beard’s” speech. I would venture that we may see some weakness today, but similar action to yesterday with a follow though to the upside.
With a pullback I’m looking to buy some ROM, and possibly a high flyer or two like BIDU, RIMM, or GOOG. For a safer momo’ play one could try the QQQQ, DIA, or SPY. If your adventurous then you could try the ETFs that give you double upside like [[DDM]], [[QLD]], & [[SSO]].
GLT
by GW
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