Gemini Markets Stocks Commentary

August 2006 was a fickle month. Up, Down and sideways to nowhere. With Iran in the background, elections looming, and high energy prices, it is a wonder the market has held up so well. If you look at the high number of shorts out there, you will find a good ten days worth of short covering built up in the market. At some point the market may break, but which way? Whichever direction it chooses, it should be dramatic, at least in the beginning. War could send it crashing down, or No War could send it rallying up as energy drops. The Fed also will play a role, but it is unclear what they will do so far. Between now and November we should get the answers we are looking for. Meanwhile, read a good book, or watch your favorite movie while the markets remain in limbo.

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Jan 2006 Market Summary

January 2006 was not too bad to us as the major indexes rose in anticipation of a good year and the final end to this rising interest rate cycle. The Rates are now at 4.5% and expected to finally stop rising around 4.75%. Gold enjoyed a nice run as cash ran from the markets, both stock markets and real estate markets. Many larger cap stocks began to shake off a little dust and move to 5 year new highs. By late in the month fear set in and some selling occurred, however, 200 day moving averages for the major indexes remain unbroken. Online Shopping was 25% better than last year and expected to continue to grow as more retailers take advantage of the new way of catalog shopping, online. A good example is J.C. Penney, previously slogging along towards a slow death was reborn via it's new websites and return to it's original business of catalog sales. Wake up Sears, bzzt..it's still your turn..

Leading sectors reaching new highs include medical systems, energy, mining, and banks. Laggards include retail leisure shopping, retail drug stores, and computer security software.

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