Premarket 8/2/05

Good Morning.

Overseas markets were mixed to slightly up and futures have had a sustained small bid all morning. The economic news was solidly inline with personal income up 0.5% and personal spending up 0.8%. The PCE deflator was slightly hotter than expected at unchanged yet is still showing overall tepid inflation. In general the report is another in the string of recent economic reports in this "new goldilocks economy".

Stocks on our radar for today are IACI, TYC, SIRI, RNWK, and CKP. We will be watching these stocks to gauge the reaction from earnings reports to see if traders still have an appetite to be long.

Interest rates continue their upward march and are causing a little buzz in the market place. Again we would be looking to accumulate more long positions on any sharp pullbacks especially if directly linked to higher rates.

Oil continues to pullback which we believe will be shallow before it attempts one more push to the mid $60 level. We will be using any strength in the market today and tomorrow to further scale out of our long positions in order to position ourselves for the looming sharper pullback that we believe is near term.

In summary: We are small sellers into strength and large buyers into sharper pullbacks.

-Good Trading-

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