'...is what it is'

It is imperative that we deal in what is, not what we think or wish would be. Did I have designs on things going differently then they did this week? Well yeh, to the tune of about 60% - 40% as follows:

• 60% probability that the market declines short term (to 800 +/-), scaring out a lot of chickens before forming the major right side shoulder of an interted H&S bottom with very bullish intermediate term implications. The plan was to be short selected areas to guard against bullish precious metals (mostly gold) positions, and then cover as SPX neared 800. Sounded like a plan but...

• There was the pesky 40% potential for the bulls to put their greed on full display, blow out the shorts and party on, led by Paulson's Plunderers (NYSE: PP). The inverted H&S scenario is now negated and this market is now in the realm of traders and pros who know what they are doing and can be nimble.

In my view, the odds are now 90% that this is ultimately going to be a tragic suck-in. The last leg that pulls in the remaining stout holdouts who sold in March in order to wait for the worst to be over.

NFTRH goes back to its original targets for the S&P 500 and for Hope '09, but first there is strong resistance right here that the market needs to overcome. I believe it will eventually do so and that the summer will ultimately prove mostly bullish. With the impulsiveness of the bull fest this week, while a decline from immediate resistance is likely, eventual upside is implied.

This all brings back into play the potential for the classic Fall agony. Potential mind you... but if we had gotten a strong decline here and now into a right side shoulder, things would have looked really good through the end of the year.

Alas, it is not meant to be. It is what it is. We'll deal with it. On the plus side, as a newsletter writer, this week was great for me. Finally, directions are being chosen and mapped out. This is the official end of the summer doldrums, at least for me.