Morning Post 9-9-05

Good Morning.

Overseas markets were up and U.S. Futures are looking higher. The U.S. Dollar is showing some weakness and Oil is pushing higher. Key tells today will be to watch the action in Texas Instruments (TXN), Intel (INTC), National Semiconductor (NSM) for follow through on yesterdays solid report, Yellow Roadways (YELL) (which had disappointing news), and Biogen Idec (BIIB) which caught a downgrade from Citigroup (C).

The Semiconductors were very strong yesterday and have ammunition to continue their relative strength today. One would have to wonder how the overall stock market would have fared without their strong shoulders. If they falter along with weak Small Caps, the stock market will market will most likely not be able to withstand this underlying weakness.

We will be closely watching how the Small Caps fare today to see if the catch up trade is still in play. Should traders take advantage of yesterdays Small Cap weakness, it would bode well for the market. A sequential day of underperformance by the Small Caps may escalate the selling pressure in the overall market.

Cracks have developed in the stock market particularly with its halitosis (poor breadth). The frustration level is high for Bears and Bulls alike (more on this later). We remain 30% invested and are only willing to increase our long exposure with an intraday trade.

Good Trading.

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