Morning comments

Good Morning:

As just as Kevin Lane’s S&P 500 piece mentioned yesterday the market breath indicators are mostly neutral and are not helping much as per giving us a bearish or bullish look on the market over all. This being said the support and resistance levels he spoke about made for an almost perfect trading range yesterday. The SPX move to 850 was met with selling pressure that brought the index right down to (almost) support 827. Until a real move is made out of this range we believe the only market play is to trade around those levels.

The bad news seems to continue with firm after firm announcing layoffs, banks to be nationalized, and everyone and every industry lining up to try to get some government bailout. This does not even bring up the international pressures that the new president and congress are facing. That being said a light of hope was the Pfizer & Wyeth deal may be the beginning of more M&A activity, especially in the drug and healthcare sectors (some of the few who have cash). We would suggest looking at Fusion’s ranking of the names that are moving higher in our scores to possibly see the next targets....see attached PDF for more info...

PS: As we were sending this note out Astellas bid $1 Billion for heart-drug maker CV Therapeutics (CVTX)... CVTX is an example of what we are talking about using the short term signals as wake up calls to changes: A NEW BUY 1/21/09 AND HIGHLY RANKED 81



posted by Peter Greene