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Trading Range Holds Firm

spx-with-fib-2009-06-19

Here is the chart I’ve shown several times updated for current prices. You can see that we are still range-bound between the 200 day moving average and 950 on the S&P 500 Index.

The various sectors are rotating within the range – those that were sold off a few days ago are rallying today. Unfortunately, we won’t know whether the next stop for the broader market is 850 or 1050 until we break out of the range.

As a strategy, we are reviewing all equity holdings from a fundamental basis and any that are weaker than the rest or that are more late cycle recovery stocks are candidates for cash. Many of these have risen significantly since March 9th, but as the market gets closer to fairly valued they could top out or fall as stronger or more timely companies move ahead.

As the weekend unfolds and my normal reviews of the markets and our holdings get underway, I will keep you informed if I see anything of note. Otherwise, you can hum the theme to “Smokey and the Bandit” inserting the worlds “Range Bound and Down” and back up again.

I am headed to a visitation later this afternoon for my friends Mary Ann & Mike’s Father, then attending the Library Foundation Garden Party to thank donors to the annual and capital campaigns – a busy Friday evening here in Champaign.

Have a nice weekend!

Mark