The markets short term direction

Posted on April 18, 2006 , filed under Stocks | Print This Post

I believe the markets will trade mostly sideways this week. I don’t expect to make much headway in my portfolio. I believe strong 1st quarter earnings will be offset by rising crude oil prices and fears over Iran’s nuclear ambitions. Oil has set a new high of $72 today. I will be watching AMR, AMR Corporation and CAL, Continental Airlines, Inc. for an opportunity to short the stocks. I believe if crude oil rises to mid $70’s and can maintain those levels for at least two weeks, I will short AMR and CAL if the prices remain in the low $20’s.

I expect gold to continue to rise in the short term. I see a possibility of the strong bull market for gold coupled with Iran’s nuclear plans propelling gold to mid $600’s by the beginning of the summer. I am looking for a pullback to buy AUY, Yamana Gold, Inc. I may have missed the chance to buy AUY when gold was hovering in mid $580’s. Gold is currently trading at $615.50.