more treasury auctions, and watch the euro!

Greetings,

Well, what a boring last couple of days in the markets. Tomorrow should give us some spark. There is a 7-10 year auction of more of that crappy paper from our treasury. This should give the treasuries more downward pressure which could get us into the 4% yield range on the 10year bond. This would be a level that should start to draw money out of stocks and into bonds which would cause a rally in the bonds. This is what I am hoping for, I really think that it would be healthy for us to have a big sell off in the stock market. I personally don't think that this market can go much higher, but I know that there is money waiting on the side lines for opportunity to get into this "roaring bull market", and a sell off would give them the opportunity. I am looking at the SP 870 area as an area that the bulls would step back in with force.

All of the printing presses, and the government sponsored bailouts has given the banks the opportunity to appear like they have escaped the storm, but there is no doubt that the delinquincies on mortgages is sky rocketing right now, and there is clearly going to be more pain ahead. They may be able to make it through one more quarter before everything falls apart. We will see.

The main indicator that I am watching right now is the EUR/USD. If the Euro sells off vs. the dollor, then stocks and commodities will most certainly sell off as well. If you cant chart currencies on whatever platform you are using, then you can try the FXE which is an exchange traded fund that tracks the Euro vs. the Dollar.

Tomorrow should be the day that we get some direction.

Cash21