We Shed Some Exposure in the A.M. 12-7-05

Good Afternoon.

The market has been under pressure most of the day except for a brief morning Spike when the Oil inventory numbers were released. We took advantage of that Spike by doing some selling as well as a little tax planning.

Although we are still pretty long we wouldn't characterize ourselves as aggressively long at this point. Yesterday's late afternoon swoon certainly put a little temporary jinx on the Bulls which is leading to some follow-through selling. The internet stocks continue to act sick which is also putting a little fear into the beta chasers.

The best thing the market could do would be for this decline to continue for another couple of days, perhaps taking the NASDAQ to 2235-2240. Should the NASDAQ reach those levels this week we will look to add back positions bringing our overall posture back to 100% net long (currently 80% net long). Keep in mind the anxious underinvested Bulls will most likely want to start their dip buying well before next weeks Fed meeting.

Hope you're doing well.

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