Friday, September 09, 2005

Back from the dead

Sorry for the lack of posts recently, but the markets were not acting well (or at least I didn't believe the market strength so I mostly stayed out).

But I have been really impressed with commodoties, especially uranium recently. As expected, they are all breaking out into higher ground. The spot price of uranium rose above $30/pound recently, and that has inspired the uranium sector to begin their next leg upward. What does this mean? It probably means that Cameco will hit 80 over the next 2 months.

For the markets overall, I still think they will go down despite the recent strength. The markets love to rally whenever disasters strike (terrorist attacks, hurricane disasters). But is this justified? The damage caused by Katrina will set the economy back hundreds of billions of dollars, and will slow growth by 1%. Also, with record temperatures in the Gulf of Mexico (due to global warming), hurricanes are going to get stronger and more frequent in the future.

The S$P 500 double topped, and the nasdaq is no where near its august highs. I'm looking for weakness towards the end of september.

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