1 in 10

Well as expected there was more bad news last week, ending with Friday's announcement of the worst employment data in 30 years. Oil maked new lows with the inevitable reduction in demand from the continued recession.

One statistic I read however really put this crisis into perspective and keeps me bearish long term. 1 in 10 American housholds with a mortgage is over due on payments or in foreclosure. For subprime loans 1 in 3!!!

BUT the market shrugged it off with a rally at the close. In fact when we reviewed the charts we can't help but feel we are in for some positive action (in the short term).

The Q's made a bullish divergent bar a couple of weeks ago and it looks like there will be a continued up move here. I believe, from an Elliott wave perspective, that we saw the completion of the major 3rd wave at that time and are now in the 1st move of the major 4th wave. Given the volitility this is one 4th wave that we may be able to play in, although cautiously.

Fridays rally has created a number of bullish set ups to test the waters with.

Even the financials XLF.

So for Monday consider:
DIA
QQQQ
XLY
XLF
XLV
XLI
XLB
XLK

Still short the commodities. GSG

Be careful out there. These are definately counter trend trades. (We are in a BEAR market)