This was the biggest one day gain ever by the Dow. 29 of the 30 Dow stocks were up except for GE--which speaks volumes about the sustainability of this rally. It seems clear to me that GE is now being used as the institutional money fund yielding close to 6%. Money comes out of GE and into other stocks, then back to GE when the rally fizzles. In other words there is no new money coming into the market, existing money is just being redistributed seeking higher short term trading returns. This rally can have legs, days, weeks or a couple of months until prices move to a level of important resistance and the sellers come out of the woodwork again. Enjoy today. For those nimble enough to trade this rally promise yourselves that you will not give back any of those hard to come by gains, if and when the market has another leg down.

Fear is rampant on Wall Street. The Dow breaks 10,000. At one instance today it was down over 800 points. The VIX (volatility index) reached 58 an extremely high number. There were 1364 new lows on the NYSE vs. 3 new highs. Technically, its as extreme as it gets. Cramer the clown is now telling people to sell after most major averages are down 35% from their highs. Until this new philosophy, his mantra was "There's always a bull market somewhere" And he is right, only now in hindsight, his bull market was in stupidity.

The perma bulls even recognize we are in a bear market. Pollyanna economists now admit the economy is in a recession. The great unwind is upon us and it is in its most violent phase. Those that have kept cash waiting for this "rainy day" are licking their chops. GE yielding over 6%; FCX trading around 37 down from a high of 127; Apple Computer from 182 to 87. Start loading up on the long side, but with quality. The crap will never come back.

The Dow undercut its March and then its January lows settling around 11,346. The Dow is down almost 1700 points since mid May. The transports have cracked 5000 though this index is holding up much better. Banks and GM are finally being downgraded to sell. Only weeks ago you heard the mantra, stocks are cheap, its close to the bottom and all that other crap. Now reality has set in. Some hedge funds which are highly leveraged and bet wrong have to be in trouble. The VIX is no where near panic levels. Barron's has resigned itself to the belief that the financials won't recover until 2010. Wall Street analysts are biased, and therefore worthless. The only truth is in the charts. While a rally could surface some time in July, it should be a bear market rally which should be used to sell stocks and originate new shorts. A Dow rally into the 11,800 to 12,100 area would be the sweet spot for this action plan.