Morning Post 9-12-05

Good Morning.

European markets were mostly mixed and Asian markets were strong, largely due to the landslide victory of Koizumi in Japan. Oil and Gold are both looking lower. Key tells today are: Oracle (ORCL) which is buying Seibel (SEBL) for $5.85b, Google (GOOG which was mentioned on Jim Cramer's "Mad Money" show on Friday, Hewlett-Packard (HPQ) which is cutting 6,000 European Jobs, Wachovia (WB) is buying Westcorp, WFS (WFSI), and Biadu (BIDU) on technical follow through from Friday.

The stock market enters the week with a short-term overbought condition. Key resistance on the S&P 500 looms directly ahead and new highs have been steadily decreasing. These are definitely concerns that we harbor and are the primary reasons for our relatively defensive posture of approximately 30% exposure. We would expect the market to find the path of least resistance to the downside, mid to later in the week. Katrina will start to slowly lose its focus in the stock market headlines as earnings warning season deals its customary blows.

A decline from around these levels would be an ideal setup for a powerful end of year rally. Therefore, unless the internals improve, we intend on quick long side intraday trading only.

-Good Trading-

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