THE INTERSECTION OF RALLY &
CRITICAL JUNCTURE!

It the day after the Giants win of the NFC CHAMPIONSHIP! so i hope you will forgive me for this late first post. Markets of course have been ignoring everything over the last 3 months and the rally has continued marching higher but we have reached a point here where it will be break out or brickwall. The mlp index which has been strong all through this rally phase continues being led higher by Kinder Morgan Partners (KMP) which is up 1 and at another all time high. The index is trying to scale above 400 on a closing basis and its up over 3 right now.

News of the messiah's rejection of the Keystone Pipeline Project has existing pipeline stocks attracting cash, especially those with rich distributions and dividends. No new pipeline just makes the ones that exist that much more attractive. Meanwhile the dow industrials are approaching 52 week highs and its either going to make for a beautiful obvious triple top formation or we are the point where we will breakout above it and head for dow 13000 or even higher.



The 10 year yield has broken above 2% which is at least a sign that the safety trade is beginning to come off. Also we have the vix now at 18 which is telling us that fear is quickly disappearing. So all is right with the world at least for now. Pullbacks intra day have been very shallow. And the market doesn't seem to care even if Google is taken out and shot. So let the rally continue as we watch this area for longer term clues. For MLPS its 400 or bust! We're at 399 as i type.

Spectra Energy (SEP) is announcing a distribtuion hike which is the only news of note this morning. My God even nat gas is rallying today. Overnight it traded as low as 2.25 so this is a long overdue dead cat bounce.