0920 EDT Wednesday June 07, 2006

The 'Fed Curse' that is increasingly befalling incoming Fed Chairman as his time yet to be tested as never before looms closer with already negative accolades mounting for Ben Bernanke from esteemed commentators and those disgruntled Senators & Congressmen, as Ben takes his wrecking ball to an already weakening economy... When will they ever learn? Deja vu again? Ben Bernanke's Big test and Destiny is unfolding - The most dramatic market movements in history still lie immediately ahead  

Good Morning: Just when it seems there is no hope for the markets as they sold off as precipitously as they did yesterday morning on back of several days of extreme weakness, spearheading almost a month of growing stockmarket losses.

Just before Midday it might have seemed that the least likely outcome, was going to be for the markets to turn on a dime and actually mount an impressive rally right into the close, especially over the last hour, when on a retest of the Midday lows, the market mounted a blistering late finish and cut its losses.  

As it turns out, during our intraday commentary, we were actually calling the lows around Noontime and explained that we were expecting the lows to be put in any time going forward from now, to over the next nine days, believing strongly that an early to mid-month bottom seems not only likely, but that the earlier the bottom, it could in actuality, potentially sharply increase, the bullish outlook for the markets.  

We are not out of the woods yet by a long shot, but it is important to keep in mind that picking bottoms is a treacherous endeavor at the best of times, but one should always be cognizant of the fact that most bottoms are made against a background of extreme negatives and over the past few days, the crescendo of negatives was palpable enough it actually caused the markets to mount a highly credible reversal attempt Wednesday. It should also be born in mind, that even following 9/11, the single worst event in US history, America refused to sell itself short and just 5 or so trading days later, against all odds, the market exploded into one of the most amazing rebounds of all time.   What brings us to this evolvingly more bullish outlook on the markets, is that fact that so far, the current bottoming structure attempt is almost a carbon copy of what happened in April last year and again in October, following the Katrina and Rita unprecedented experiences. Interestingly enough, in both instances, the two previous bottoms, which are almost equal in days length, both suffered one final setback that caused the bulls to throw in the towel, only to see markets take off from there, just as the markets turned on a dime and rose higher.  

In light of this, Wednesday 06 06 06 becomes a potentially significant reference point, wherein, should the markets continue to rally from here and accelerate higher, then the odds that the lows are in would increase markedly. However, in the event that the markets should now break down from Wednesday's rally attempt and start taking out Wednesday's lows, then all bets are probably, mostly going to be off and in all likelihood lower lows of some degree will be ahead and with that the increasing probability of a significant lower low turning point later, but still more likely than not, at some point leading up to the middle of this month and actually could create and even stronger bottom.  

The case is equally compelling for Gold and Silver, which even though they have taken a shellacking of late, appear to be in a bottoming zone and potentially major rebound territory, as this uptrend was so awesomely strong prior to the ensuing correction, that once the turn comes and the uptrend resumes, be prepared for some breathtaking upwardly trending surprises with at a minimum, old highs challenged.  

Investment Intelligence has a thing about timing and dates, especially the rarities of solar events and unusual dates such as 06 06 06 and since MODAR has been dogged by technical issues as it expands coverage to include Nasdaq and other markets we are slowly but surely overcoming these issues and actually had intended to re-start MODAR on what we believe is a date that is a positive omen for the future... As long term readers may recall, we began MODAR's predecessor on 09 09 99, with the stunning results of thousands turning to millions.  

Trade Well From the Desk of Savant