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Wednesday, March 9, 2011

Wednesday Morning

The market opened soft this morning, trading off 20 Dow points in the first 15 minutes.  Europe and Asia were mixed over night. Greek and Portuguese debt were again in the news as the ECB ministers get ready to meet again to sort out the debt issues of the "periphery" nations.  Oil continues to consolidate its gains, trading in narrow range and trading currently higher at 105.49.  Gold is higher, trading at 1432.30 while Silver is higher at 36.02.  The commodity complex is mostly higher

The Euro is higher after  being lower over night, trading at 1.3921 and the Dollar is again lower, trading at 76.67.  U.S. debt is firming after 3 days of weakness, with the 10 year Note trading at 3.529 and the Bond trading at 4.64

Not much "new" news this morning, with the same-old-same old MENA troubles, however Zerohedge is reporting a "leaked" pre-publication statement from Bill Gross at PIMCO that the worlds largest Bond Fund has completely eliminated all U.S. Treasuries from its portfolio, and currently has $54.5 Billion in cash, the largest cash position it has ever held.  That's a lot of cash!.  But what I find the most interesting is that among his remaining debt positions  (there are 5 sectors), the longest duration portfolio is 3.98 years.  Let me help you understand what this means.  The guy who is most likely the most connected insider of all connected insiders does not like U.S. debt, and he does not want the principle risk associated with longer term debt portfolios.  My take away is that he expects higher rates and does not like the Dollar.  Duh!

Here is a link to the PIMCO report.

Looking at his portfolio duration, he is thinking very short term.  I can't imagine that  the market he apparently sees developing is one that will be favorable for long term stock and bond holders.

The Momentum Change indicators are still Bearish, with little movement yesterday with the 124 point rally.  Mr Market is stuck in a very narrow trading range, with a series of higher lows and lower highs... it should resolve its self in the next few days, as there is little room to continue the developed patterns.

Best To Your Trading!

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