FRIDAY -- FUTURES POINTING TO LOWER OPEN

Thursday’s trading was strong as cash flooded in and all three major indices leapt to their best levels in months – stocks closing just off the session highs, the S&P 500 and Nasdaq rocketing. Earnings reports have been flooding in, and pretty much they have been okay (but keep in mind that very often this has been due to cost cutting, rather than real revenue growth). Crude oil was considerably stronger. And it seems Dow Transports have broken out.

Asian stocks have now risen for the ninth straight day -- and European stocks enjoyed their longest rally since 2006.

There truly has been a sense of euphoria as more and more folks have joined the camp of believers who think that they must get long or be left out.

There is no way to precisely know when this euphoria will wane, but we do expect that there will be a pullback – and that with patience, there will be better entry points. Should the market continue higher, we will continue to take bits of profit, raising cash for the better entries.

Also, with a longer term view, we keep in the back of our minds the fact that interest rates will rise -- even Federal Reserve Chairman Bernanke has said that. And as interest rates rise, borrowing costs will be higher for the U.S. government – which in turn will slow economic growth. So we believe that there are challenges ahead that will impact the market – and it is too early for dancing Bulls because we are not entirely out of the woods yet.

An additional note: Our office will be closed during the next week for our annual summer break. We will be back posting again on August 3rd – (already looking forward to getting back into things again). It is always hard to walk away from the market for even a day. But some of my children scheduled their own vacations to spend time with my husband and me, and I'm really looking forward to enjoying time with them. They are, after all, what it is all about. And truly everyone here deserves a break, a chance to do what is personally important to them. In the end, it is a good thing because we will return refreshed and ready to deal with what is at hand.