Thursday, October 02, 2008

Upside Surprise Potential Remains High

As we have been discussing in recent updates, this is no time to step in and try to catch a falling knife. Nevertheless, the potential for an upside surprise remains strong.

The SPY is extremely oversold on a weekly basis and has dipped down below monthly support. The potential for prices to hold near current levels and rally firmly higher are much more likely from a technical point of view than further significant downside is.

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