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[ogm]

I still favor the Yellow scenario with a rally starting from wherever this washout bottoms by the end of the week into the September 18th Fed meeting.

After that we'll visit that orange support line. It was a long time coming.

The spread between the upper EMA's is too wide that makes retest of the upper EMA very likely. More then 75% chance likely.

I do think that the orange trendline will hold and we'll have a big rally from there as the uptrend will be completely reset by then, and man, do I foresee fear and bearishness if we get there. End of the World pending of course.

Edited by ogm, 16 August 2007 - 05:16 AM.

[ogm]

From fundamental perspective. I beleive that this debt crisis will be resolved short-mid term, as the risk/rewards are now improving on debt paper, due to the widening risk premiums. However... in the grand big scheme of things the center of global economic activity is shifting to Asia. That means I'll try to concentrate more on Asia markets or companies that service asian markets. The US is losing its economic leadership unfortunately. This debt crisis will probably cause a moderate economic slowdown in the US and the Fed will lower rates and will pump in liquidity. I think Fed has no choice here, they must bail people out and allow them to refinance the massive housing debt at lower rates. Overall the incomes are growing fast enough to support the economy. 6% yoy as measured by tax receipts. Employment is still not shrinking. 2 big things that will drive US economy in the future are Energy revolution and Infrastructure upgrade. These will balance out the slowdown from housing. But overall the US economy will remain sluggish for many years.

Edited by ogm, 16 August 2007 - 05:37 AM.