Nothing has changed....... until now!

It has been four months since I posted last. How terrible. But not much has changed. Until now... Back then at the end of February, I was commenting on potentially bullish developments. Those have played out. And they appear to be completely played out. Prepare for the next phase of the bear market. Will it be the terminal phase? Possibly, but we will not know until we are past the point of recognition. In other words, we won't know if the bottom is in until it has already passed. But as in Feb, there will be hints. Some stocks, maybe most stocks will make new lows, but more and more will not confirm. This is exactly what is happening now in regard to the rally. More and more stocks refuse to confirm the rally. My belief is that the next sector of the market to take a hit will be the stocks that seem to have held up the best, largely tech names, IBM, RIMM, even AAPL. That does not mean that lousy financials like AIG will not take a hit. We might actually see AIG go bust this time, now that there purpose has largely been filled. That would require the Fed to take a $180 billion hit, so I am not betting on it. But I AM betting on AIG going back below a buck after its reverse split.


Let's look at a few pictures of what I am talking about.


RIMM is leading the way down. It appears to be on the verge of a breakdown to fill the gap at 50.
IBM is approaching critical support in the high 90's which if broken will lead to a rush to 70.


And the big daddy, AAPL. "How could Apple go down? They are selling iPhones, iPod, and all that other iJunk like hotcakes!" Hey I don't know. But ultimately, before it is all over, AAPL is likely to be selling at 40. YES, 40. Maybe 20! I know it sounds crazy. Call me crazy!