Abet Chichi2

[2H2]

Blustar Market Update Weekly 12-28-03


The stock market looks like it is forming a ST top on Monday Dec 29 and QQQ 36.20 or slightly above and SPX 1195-96 looks feasible and then a reversal likely into early Jan 2004. How far it goes down is subject to the market's whims, but max would be 33.70 on the QQQ and 1042 on the SPX no later than Jan 8th 2004.

If Jan 6th marks the low, then 34.80 would be minimum and the SPX 1060's. A rally to new recovery highs would be expected out of this low into mid Jan 2004 and then a fairly severe correction of at least 10% (no more than 11% on the SPX) should be expected into late January/early March (double bottom?). QQQ should hold 29/30 on any such sell-off or about 20-22% correction.

I believe we see the SPX slightly above 1100 in mid January.

Funds should already be short going into tomorrow as I believe we see an intrady rally after a little early morning weakness (QQQ 35.80?) and then an intraday top and reversal about two hours before the close.

I like INTC as a good short and a target of 27.11 by Jan 6. It was 31.35 on the close Friday. Jan 30 puts also look good to me.

Have a good week and a Happy and Prosperous New Year,

Brad Gudgeon
Blustar Market Timer