Looking for the Bulls to Step Up

By Jim Farrish | June 17, 2008 | 9:49 AM | 0 Comments

Yesterday we were still focused on oil and what the potential of $140 a barrel oil would do. OPEC decided to help, but will they really be able to impact the price of oil with increased supply? That is a question that only time will answer. For now oil is remaining above the $130 mark and that is not good for the economy. Inflation remains the topic of choice. The PPI data today shows at the producer level things continue to heat up. An increase of 1.2% on the top line number was not comforting for the outlook of more inflation coming.
 
Small and midcap made nice moves yesterday to regain some momentum. My question is will it move higher from here? Worth watching (AMEX: IJR), iShares Small Cap Fund and (AMEX: IJH), iShares Midcap Fund. Both made a nice move higher yesterday. Technology moved up on the back of semiconductors. (AMEX: IGW), ishares Semiconductor Fund is the ETF to watch for a follow through here. Semi's sold off last week along with anything related to growth. Precious metals were back with gold gaining $13. (NYSE: GLD) and (AMEX: SLV) are worth paying attention to as well with the inflation talk all over the media today. Silver moved higher by 3% yesterday.
 
We remain at a decision point and investors have migrated back to their old friends energy, agriculture and metals. The spreading out yesterday to other sectors mentioned above was a positive sign for a bounce. It is a traders market and that puts more risk in what plays you take. Volatility has picked up again and that generally leads to a trend change. We have been in the middle of one the last two weeks and from my view we still haven't clearly defined the next trend. Last week the bears had the upper hand this week I am looking for the bulls to step up. If they don't look for the trend to shift to negative.