Market retests bottom channel

8/18/08

With fear arisen from FNM & FRE, financial again pull down major market indexes in red notes. Both Dow & S&P indexes are testing the lower channel support. The bearish rising wedge will eventually play out the true move. Notice the moving averages are narrowing that means big moves often originate out of low volatility or reduced range conditions, such as current markets. This is similar the pattern from March to May. Good luck to who is holding financials!! Especially, FNM & FRE, C, WM, NCC,....etc. Those are eventually going to ....you know what I mean.