October 24 Stock Commentary

October 24, 2005 Stock Commentary
By Benjamin TrainOctober 23, 2005

The market is setting up for another very volatile week and the next big short-term reversal to the upside. I am also seeing a short-term cycle low in the DOW and the NASDAQ this week to further consolidate the markets equities in several sectors.

This is the right time to enter precious metals (PM) mining and stocks for the large upside ahead over the next few weeks. The Fed's inflation vigilance persists in the manipulation of the futures market with hedge funds waiting on the side and retail buyers wondering when the pain will end.

According to Gene Arensberg with the Resource Investor, ( http://www.resourceinvestor.com/ ), "Judging by the COT and technical signal “tea leaves” caution flags remain flying, but the odds may be shifting back in favor of the bulls. Confirmation (or not) of the Friday attempt at support in the $460 range is the key development to watch for in the coming week."

I will be adding to my PM positions in AUY, CDE, NG, SA, WTZ and HMY. I am also adding to my copper position with PCU. Even though I saw retail buyers of the PM stocks last week, I believe they where ahead of the 50 and 200 day curve and responding to a slight rally during options expiration.

CAT with a high target of $72.00 may see a little further decline before I add more shares near my target of $49.10-$48.45 range.

Even though the energy sector looks oversold, CVX has some long-term buy signals going off along with XOM from the Institutional sector side, some of which are coming from a Natural Gas deal potential. Look for energy company earnings reports to look great, but remember that you are buying up against the Fed's, and the seasonal trends declining futures market prices.

The only thing that will drive another energy rally this year is another disaster in the supply line. The hurricane may drive a short-term rally for TSO and VLO. I will be watching and adding additional shares of NGS, NGAS, SWN, SWSI this week. CHK is a must along with BTU after the consolidation.

In the Biopharm sector ELN, BIIB, AVN and PTN are on my buy list for additional shares, purchased on dips. GSK almost looks ready for a buy signal near their 50 day moving average of 49.80, but I'd wait and see if their 50 day is more of a solid buy.

Take note of Elan's Latest News regarding the FDA priority review application status
from NCB’s online Irish Equity Stock Guide October 24, 2005:

Elan $8.12 BUY Clarification On Priority Review Timeline for Tysabri

• One note of clarification on the priority review timeline for Tysabri.
It was previously understood that the FDA would respond to BiogenIdec/Elan's
request for priorityreview within a 30-day period.

• We now understand that the FDA has up to 60-days from the date of
submission to respond to this request (a decision is now expected by 25th November).

• The timing of the priority review decision will not impact the time the FDA
will take toreview the sBLA file (6 months from the date of submission for
a priority review or 10months from submission for a standard review).

Excerpt from Elan's page on NCB’s online Irish Equity Stock Guide By Orla Hartford +353 1 611 5844