Indices needs to build base AGAIN.........

S&P 500 went from 1136 to 1220 on Friday, a gain of 84 points or 7.39%, indices needs to rest here & build a new base. Indices should find strong support around 1200+-

SO...if we pull back on Monday & Tuesday...then it is another buying opportunity...

Wednesday Fed will give us good news around 2.15 PM, which should give market a boost. The way i see it, M,T & Wed AM should be a pullback time.....

Character of this market HAS changed for the better, no more breaching any major support.....any pullback is desirable & healthy @ this stage.

Many technicians are very nervous about this TAPE & expect 500 point drop again in a day...i totally disagree with this thesis.....pullbacks will be orderly & normal.....

We have a very good chance of hitting 1260, after basing which MAY last no more than three days....

Gold closed @ $1814....many so called gold bulls / technicians are rooting for $1600 for several months..BUT they are indulging in "text book technical analysis"...which does NOT work in extremely bullish TAPE...i am expecting new HIGHS in Gold....

Current reading on bulls & bears are as follows :

Bears 40.9%

Bulls 35.5%

This reading proves my thesis that after a "brief pause" we go HIGHER...these readings are great CONTRARY indicator....

SO..based on my thesis, you can relax & do nothing or build a position on weakness.....

Here is my $ allocation as of Friday's close :

RIMM 39.03%

BIDU 29.84%

AUY 22.12

PMCS 9.01%

Allocation is 92%, down from 105%

I am sure most of you are shocked @ my purchase of RIMM & its OVERWEIGHT in my portfolio. When all analysts & so-called pundits are overjoyed @ its dismal report....BUT majority are looking @ headline numbers only & NOT going in-depth.....On the CONTRARY, i see a tremendous buying opportunity which is saying "screaming BUY" based on Fundamental ANALYSIS....i wonder how many traders or show biz gurus do that?

Here is my fundamental analysis on RIMM based on comparison with AAPL & NOK :

AAPL Sales $100.32 billion, Market Cap $371.3 billion, PE 15.85

NOK Sales $58.77 Billion, Market Cap $23.03 billion, PE 9.14

RIMM Sales $20.57 billion, Market Cap 12.54 billion, PE 3.80

You can clearly see that market HAS over-reacted to RIMM results.....there is a "high probability" that RIMM could be taken over by AMZN,MSFT,DELL,HPQ,ORCL or some other international firms...The above numbers were taken from www.investing.money.msn.com

Final comment on RIMM, i do see RIMM beating current guidance form hereon.....next month they will preview QNX phones in their developers conference.....

Good luck with your your OWN analysis of markets.

BLOG does NOT give buy or sell.

PS...post was delayed due to visitors.

Saleem