Don't know if you read him but Jim Jubiak had a good article today pointing to the Bank of Japan's efforts to sop up their excess liquidity as being behind a lot of this drop, especially as respects speculative asian markets. Do you agree? Also, what's the best way to keep an eye on the BOJ?

Here's the article:

http://articles.moneycentral.msn.com/Investing/JubaksJournal/HowJapanSankTheUSmarket.aspx

Quints

My cut fingers and hands have kept me from typing lately ;)

The best definition I've run across lately for volatility is:

'Readiness to Vaporize or Evaporate'

Chief Falling Knives

Excellent Don Coxe call, thanks for sharing, I'm thinking about opening my cottage.

Volatility could continue to benefit 'flight to safety' stocks. Days like today they will be offered a little cheaper than otherwise.

If gasoline backs off a bit I think casual diners could get some attention. Note their better relative earnings growth in downturns such as 2000-2002 cause their shares to outperform during those 'volatile' windows.

Several of the large cap names are trading at low RSI readings; but hold strong long term trends. Short term probably need to see the short term downtrends broken to get aggressive.

I am long some EAT. P:E and P:S at low end of 10 year range.

This afternoon, the US dollar is trending down against most currencies, including the yen. And gold is up against all currencies.

Bill , All - Do you Like Oats ?
+ I do ! (long term)

http://cmd-chart.blogspot.com/2006/05/oats-futures-o-cbot.html

So what kind of odds do you put on Bernanke growing a pair and raising by 50bps?

I am beginning to factor the slight probability into my investment decisions.
http://money.cnn.com/2006/05/23/news/newsmakers/fed_bernanke/index.htm

Bernanke hasn't learned hasn't built the iron wall required of a Fed chairman to keep his intent completely concealed. His slip-up to Bartiromo was clue #1. Clue #2 is the fact that Kudlow, right-wing supreme, is now saying he favors a 50bp hike...is he being whispered hints our financial fates?

All-

What to think of today's market action? From R. Russell:

"Yesterday I was surprised to see that Lowry's Buying Power Index dropped 3 points to a new multi-year low while Lowry's Selling Pressure increased by 5 points to a new multi-year high. Also, my PTI dropped one point. This is obviously not good action."

This is exactly my reasoning for paring long exposure, no matter how much I like a sector--oils, metals , you name it. Declines in this environment can be unexpectedly steep, despite oversold conditions according to J. Hussman (www.hussmanfunds.com). This afternoon's selloff is Exhibit A.

Good trading and good risk management all.

The last hour of trading and after hours, the dollar had a big bounce up, including the move against the yen, gold went down, and US bonds rallied. Central bank intervention? Bonds are at about the same rate as a month ago even with the news finally out about inflation. And yet US stocks tanked the last hour with housing stocks fading also. Is the consumer finally getting tired?

I thought it was amusing that two days ago Marketwatch said that the reason the US market went down was that commodity prices were falling, and traders were concerned that the economy was weakening. Yesterday, Marketwatch claimed that the reason the market went down was because commodity prices had risen. It's no wonder that so many people are confused about what they should be doing. And, it's the main reason why I have become almost a pure technician, and don't worry about fundamentals much at all.

I try to let the market tell me what's going on. Right now, as much as I'd like to buy the dips in energy and mining stocks, I'm resisting doing so for that reason. The downturn needs to prove to me that it has stopped first. I'm sure I'll probably miss the bottom, but I'd rather wait until the smoke clears.

Eve:

You are not alone !