Last week was supposed to provide more of an indication of how steep the correction would be, but all we have now is more uncertainty… both from a technical and fundamental perspective.  Fundamentally, we’re once again going to play the ‘goldilocks’ game where the market will applaud data that is seen as good, but too good.. a bit weak, not too weak.  The market fears the dreaded interest rate hike and cheers any indication from the Fed that rates will not rise any time soon, despite underlying concern.  In my opinion, the big move up after the Fed announcement was temporary jubilee over a less hawkish stance from the Fed which fueled a round of short covering.  The important thing to consider is that massive sell offs (like what we saw on February 27th) aren’t aberrations and do forecast trouble ahead.  While the potential is there for the market to retest its highs, the V shaped bounce we’ve seen is not sustainable.  From a trading perspective I’m not looking get increasingly short unless we  see another day or two of low volume buying.  On the flip side, if last week’s move is retraced with light volume selling I’ll probably look to add a few swing trades for quick profit on the long side.  It just continues to be a very difficult market to read right now with a high degree of volatility.  If you’re not a short term trader, I’ll suggest again you step aside and let this correction play itself out for a couple more weeks.

::: Model Portfolio Update :::

Staying primarily short and in cash obviously didn’t prove to be a profitable strategy during the week, but I made the decision not to play the potential for a bounce after the key reversal on March 14th and remain with the positions I had.  As a result the portfolio was off .6% for the week, dropping the YTD gain to 5.9%.  Just one transaction was made during the week.  I dumped my long position in CYBS for a small loss of 6%.  The stock was submerged below support of the 50 day moving average and sell volume was overshadowing buy volume.  At this point my strategy is to remain somewhat stationary until the market can provide a few more clues as to the severity of this correction.  If we get a few days of light volume selling, I’ll be tempted to initiate a long or two to get the portfolio more balanced.

::: Best/Worst Performers :::

– Top 10 Performing Industries For the Week –

1. Oil & Gas Drilling & Exploration: 8.15%
2. Industrial Metals & Minerals: 6.90%
3. Independent Oil & Gas: 6.85%
4. Oil & Gas Refining & Marketing: 6.55%
5. Long Distance Carrier: 6.40%
6. Steel & Iron: 6.20%
7. Trucking:  6.15%
8. Nonmetallic Mineral & Mining: 6.05%
9. Metal Fabrication: 6.00%
10. Major Integrated Oil & Gas: 5.90%

– Top 10 Worst Performing Industries For the Week –

1. CATV Systems: -5.10%
2. Printed Circuit Boards: -3.85%
3. Drug Stores: -1.90%
4. Processing Systems & Products: -1.35%
5. Tobacco Products – Other: -.20%
6. Semiconductor – Broadline: .30%
7. Marketing Services: .65%
8. Copper: .70%
9. Toy & Hobby Stores: .90%
10. Cigarettes: .90%

– Top 5 Best Performing ETFs For the Week –
 
1. India Fund (IFN)  9.70%
2. Central Europe & Russia Fund (CEE) 9.05%
3. Morgan Stanley India (IIF) 9.00%
4. Turkish Invest Fund (TKF) 9.00%
5. Ishares South Africa (EZA) 8.85%

– Worst 5 Performing ETF’s –

1. Templeton Dragon Fund (TDF)  -1.80%
2. HLDRS Broadband (BDH) -1.70%
3. Ishares Silver (SLV) .20%
4. Central Fund of Canada (CEF) .55%
5. Ishares Networking (IGN) .75%

:::  IPO’s Worth Watching for This Week :::

1.  Super Micro Computer (SMCI): designer of application-optimized, high-performance server products that are based on modular and open-standard x86 architecture.  Super Micro is a rapidly growing and profitable company.  Trading set to start on Thursday.

2.  eTelecare Global Solutions (ETEL):  based in Quezon City, the Philippines, is a provider of business process outsourcing, or BPO, services. The company offers services, such as technical support, financial advisory services, warranty support, customer service, sales, customer retention and marketing surveys, and research. Among the company’s clients are American Express Co., AOL, Cingular Wireless, Dell, Intuit, Sprint Nextel, and Vonage Holdings. Trading set to start on Wednesday.

3. GSI Technology (GSIT): provider of "very fast" static random access memory products used in high-performance networking and telecommunications equipment, such as routers, switches, wide area network infrastructure equipment, wireless base stations, and network access equipment.  Trading set to start on Thursday.

::: Upcoming Economic Reports (3/26/2007- 3/30/2007) :::

Monday:        New Home Sales
Tuesday:       Consumer Confidence
Wednesday:  Durable Orders, Crude Inventories
Thursday:      Initial Claims, GDP Final
Friday:           Personal Income

::: Notable Upcoming Earnings Reports I’ll Be Watching This Week :::

No Notable Earnings for This Week

::: Latest Blog Entries – In Case You Missed Them! :::

– SelfInvestors Blog –

1. After Market Report – Buyers Lack Conviction; Energy Looking Good
http://investing.typepad.com/tradingstocks/2007/03/after_market_re.html

2. How Quickly Bears Turn Into Bulls; Stock of the Day – Zumiez (ZUMZ)http://investing.typepad.com/tradingstocks/2007/03/how_quickly_bul.html