BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Medical longs and Biotech longs. I covered all my (IWM)/(QQQQ) hedges and some of my (EEM) short this morning, thus leaving the Portfolio 100% net long. The tone of the market is mildly bullish as the advance/decline line is higher, most sectors are rising and volume is slightly below average. Investor anxiety is very high. Today’s overall market action is mildly bullish. The VIX is falling 8.4% and is very high at 58.33. The ISE Sentiment Index is low at 115.0 and the total put/call is above average at .96. Finally, the NYSE Arms has been running around average most of the day, hitting 1.59 at its intraday peak, and is currently .77. Nikkei futures indicate an +180 open in Japan and DAX futures indicate an +30 open in Germany on Monday. I expect US stocks to trade modestly higher into the close from current levels on short-covering, bargain-hunting, less forced selling and diminishing credit market angst.
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