Premarket 8-3-05

Good Morning.

Overseas markets were lower pretty much across the board overnight and futures have been under pressure here in the US. There was no economic news this morning however, we will be watching the ISM number to be released at 10am. This could add fuel to the down side if the number comes in weaker than expected. Stocks that we're watching today as tells for the overall market health are TWX, RBK, RNWK, BRCDE, CI, and OSTK.

The dip buyers will most likely attempt to pounce on any noticeable weakness today. We would expect at least a couple of attempts from the stubborn Bulls before any meaningful sharp pullback materializes. We do not believe that playing the shallow dips for a bounce would be a good risk/reward ratio. However, we are most certainly interested in deploying our now large cash position into sharper more fearful pullbacks.

Oil continues to drift higher and rates continue to rise which is drawing more attention from the stock market traders. We recognize that we may be slightly early in our defensive posture but with signs of euphoria in the market and us having one leg still in the water we believe we have obtained a solid position to capitalize on a likely sharp pullback.

-Good Trading-

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