Market Analysis 02/28/2010

February 28, 2010 · Posted in Weekly Posts

Markets remain edgy and uncertain across the spectrum of equities and commodities. Until we see more evidence of a direction we will refrain from any real commitment to the long or short side.

This week we have a sale of Greek bonds. Depending on how that plays out we could see a negative market reaction or a shrug. We doubt it will be possible for the sale to generate a relief rally.

Also this week the February employment numbers come out. Given the continued misses on the weekly reports it is unlikely we will get a positive surprise. The possibility for a negative surprise seem pretty good so be very cautious ahead of that report. Given the backdrop of increasingly negative economic reports it would seem that we may well be heading for a sell-off. Looking at the charts it is possible the S&P is in fact turning the corner from the “B” wave into the “C” wave. That said there is plenty of upside potential within that to kill any short position.

Gold moved up nicely Friday off of its 50 day MA and the dollar decline. We remain cautious though as this rally has not had the oomph of last fall’s move.

Hopefully this week will see some resolution in one direction or another.