But since I don't have a crystal ball, I can and often do adjust. To my way of thinking it is a more mature and realistic way of managing markets, given that I can't control them.
The activity of the last week has served to compromise the analysis from a short term perspective (deflationists to get one more kick at the can before all that panic policy manifests in rising asset prices into the elections) and it appears that our friends in Congress are getting the lead in to the hope pump nice and early with some nice financial results (of the inflation manufactured by policy makers) to titillate the markets and Bernanke lurking in the background amid whispers of QE2.
Nobody knows what will happen. Here is one plan illustrated by old friend the Alcoa Aluminum chart. What do you think of the possibility that AA rebounds to test the neck line breakdown and SMA 200 off of the little inverted H&S that has formed? It measures to that level and I just love it when charts present confluent data points.
So here is but one little road map for the summer of hope and beyond... As AA does a very normal thing and tests its H&S breakdown, various markets test their April highs - and by the looks for things, many attain marginal new highs - and then? Well, let's let the analysis unfold as we move forward. But AA still targets 8 bucks, so we can draw some pretty nasty conclusions off of that, eh?
Alternatively, AA negates the H&S top and we are off to a new inflationary bull cycle. We will manage the post-election at the appropriate time but ultimately at some point, and considering the ongoing monetary policy (i.e. the policy of using paper & digital money as little more than disposable fuel for economic growth appearances) it will be "inflation all the way"... kids. At that time, you should know where you want your capital to be in this world because capital is going to be very afraid and it is going to panic into assets of value and regions of relative value.
