The 007 Decline! 3-9-06

Good Evening.

Today's tape had the slow creeping feeling of doom that only James Bond had experienced as he was tied to a metal table with his legs spread while a cutting laser beam slowly crept towards his testicles. We were going to use an analogy from the 1960's Batman & Robin show when they were often imprisoned in some bazaar contraption awaiting a slow death; but we couldn't resist the urge to say testicles on the blog…hey there's a first for everything at Kcap.

The market squandered the spike higher this morning by drifting lower in a torturous way throughout the trading day finally closing at the lows. The despair and frustration is starting to rain heavy in the minds of Bulls and Bears alike. The market just can't seem to make a meaningful move in either direction. These are the times when traders need to be well prepared with a shopping list for when the market finally wakes up and starts to show some more drama. Until then, get used to the fact that this market is stuck in a trading range between NASDAQ 2230 - 2300.

Your friendly neighborhood Kcap Team will use the lower end of this range to continue to scale into Networking and Financial Stocks. We still like the Gold complex; however our exposure is sufficient enough for the time being. Should the market break out of this trading range to the upside, we expect a serious chase to take place. Most Bulls are underinvested and most Bears are not very short. The Bulls will need to add significant long exposure to quench their thirst when the market runs and the Bears will be easily converted. Therefore, our excitement is building over the hope that the market can break to the upside one last time before the grisly steps up to the plate.

If You Held a Taser To Our Head:
The recent decline in the NASDAQ has now made it possible for an upside attempt, noticeably higher than our previous target of 2340. Should such a powerful move materialize, you can bet your own testicles that the Bears will create a mirror image ultimately taking the NASDAQ to 2150 sometime this year. Get ready for some volatility, it's coming!

We'll be posting again on Monday. Have a good weekend.

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