It's been a while since I wrote this letter but things have been alittle busy.
Anyone who has been around me since beginning ofJanuary knows that I turned bearish and have been since then. Therally that went on in February was led by energy and basic materialstocks. These sectors do not lead market rallies for too long, theyjust don't have the long term growth rates necessary. If you paidattention to the price volume action of theindexes you would've noticed that the down days kept coming in inhigher volume then the up days. The NASDAQ which was the lastindex to show a follow through, followed through too late, andcouldn't mke any headway passed it's 50DMA. Leading stocks, whatleading stocks. That's right, right now there are none. Energy andbasic material stocks cannot lead a rally for too long, they justdon't have the long term growth rates necessary.
If you're not out of your long positions by now, make sure you keep areal close eye on them. If they are down significantly don't beafraid to take profit or the loss. Once the market gets some legsagain, there will be plenty of opportunities.