Market Comment (S&P 1240) (DJII 10942)

So far, I view this as a healthy intermediate term stock market correction in a long term uptrend. I don't think it's anywhere near over yet.

Regarding interest rates, I still maintain the view that short rates are in a relentless uptrend that will not be deterred by loud jawboning in the financial community. I continue to believe that long rates will pace short rates on the upside - eventually cooling out the housing bubble.

Gold, silver and copper have taken a major hit and will need some basebuilding once they settle down. Why such a huge hit? In my opinion, the metal commodities spiked sharply above what was an otherwise healthy long term uptrend. The subsequent sharp correction has all but wiped out the spike, and I'm now anticipating an eventual return to the underlying uptrend. Having said this, I should add that single spike patterns are rare indeed. I would guess more wide swings lie ahead as we unwind the spike, but the underlying long term trend, as I see it, remains positive.

Philly Bank Index (106.64)

The Philly Bank Index has now slipped below its 100-Day Moving Average and shows evidence of something more than a minor correction in the making. I'm paying attention because bank shares often provide leadership for the broader market.

U.S. Dollar Index (86.44)

I'm watching a healthy short term recovery in the U.S. Dollar Index with the potential to test the 200-Day Moving Average at about 89. There may be more near term base building work to be done here, but beyond the near term the picture is improving as I see it.

Market Comment (S&P 1252) (DJII 10892)

On May 9th, 2006 I published a Market Comment blog to say that I was paying attention because we were at too many important market resistance milestones. That turned out to be the date of the recent market peak.

Here's another market milestone. This week too many stocks that I follow pushed their noses below their own 200-Day Moving Averages. That's not healthy, so once again I'm paying attention.

Stock Comment Raytheon ($45.85 U.S.)

I suspect that the recent high for RTN at $47.50 will prove to have been important beyond the near term.

Stock Comment Transocean Inc. ($78.40 U.S.)

I hate to say anything negative about an oil related stock, but I suspect that RIG may have completed an important intermediate term top when it hit $90 recently.