I’m giving myself a little pat on the back today, and I hope you are profiting from my last two editions and last week’s BLOG.

As predicted, the market is coming a bit unglued after a two month, pretty much unabated run up.

The CNBC contrarian indicator worked perfectly. On Monday, the network trotted out the usual cast of characters, all forecasting the “all clear” sign for the markets on the horizon.

All clear- hardly. Today, they had a few comments with a slightly more negative tone, and once we’re done another 100 points on the NASDAQ COMP they will have nothing but gloom and doom forecasters lined up to predict the demise of the American economy and civilization as we know it.

That will be the time to take another look at the long side for some of the recent high flyers that have entered corrective phases- Apple Computer (NASDAQ: AAPL) and Research in Motion (NASDAQ: RIMM) are two that come to mind.

In the meantime, my 2,000 shares of QID at $38.67 are now up a cool $3k at $40.20. The options I suggest- the June 38s at $2.50 (QID.FL) closed at $3.00, and the July 38s at $3 (QID.GL) closed at $3.90. Those are nice gains for 1 1/2 trading days.

If the market bounces back and tries to recover a bit, I am going to add to my position by picking up some of the calls or simply adding to QID. I believe there is a ways further to go in this correction, and my target for QID remains in the $44 to $45 range over the next couple of weeks.

The headlines would have you believe that the market’s sell off was all about oil today, but it wasn’t. However, oil is spiking to $134 in after hours trading. That’s not going to help.

The market’s real concern was all about the minutes of the last FOMC meeting, which were released late in the day. Within the minutes it was found the FED had downgraded its economic forecast for growth, pretty much committed to stop lowering interest rates, and raised inflation fears. All in all, not good for stocks.

On the microcap front- pretty much unchanged. SPKL cannot seem to break through $.90- EFSF disclosed CK41’s game plan for PurEffect yesterday, and it was received moderately well, and all the others remained quiet with very little price movement.

Tomorrow’s another day, and I’m hoping for a little relief rally so I can commit more capital to betting on a correction. If it keeps selling off, I will simply have to be happy with what I’ve got. This correction is going to be the pause that refreshes, and could set us up for an unusual summer rally.
Comments and Questions are welcome.