Looking Forward to Capitulation

| About: Apple Inc. (AAPL)

If there’s one thing I can’t stand it’s monotony - the same thing, day in, day out. The thing I’ve always loved about the markets is the uncertainty: the incredible highs, and the devastating lows, the frothy middle. But lately I’ve been grappling with delivering the same old story day after day. I’ve been trying really hard to paste a unique theme to each market analysis, to set it apart from the previous one. But the theme well is running dry, I’m in danger of repeating plots, stereotyping characters.

So this time I’ve decided to change it up a bit. No longer am I going to report another dreary day in the markets. No longer am I going to prognosticate a dim outlook. From now on, at least until the next analysis, the plot is change and hope. I’ll be looking forward to the day of capitulation, the day when either the rally begins, or the fall into the abyss ensues.

Things are starting to come together in a rather obtuse way. The pressure has been slowly building, the charts are aligning. What am I talking about? Well, we’ve been oversold for quite some time now, the oscillators are pinned at the bottom of their respective cycles, the market internals, like the advance-decline line, are in the crapper. No rally lasts more than a single day, sometimes only part of the day. Cats are sleeping with dogs, women and children have been the hardest hit.

Why don’t I think we’re just in for more of the same? Because tomorrow is the start of a whole new series of market antagonizers. Yes, tomorrow we start with more economic reports, and earnings season is upon us. These are the things that got us to this point, and with the market pinned to the floor, it’s hard to imagine that it can go much lower before it bursts to attention.

On the plate this week we have earnings from Alcoa (NYSE:AA), Pepsi (NYSE:PEP) and General Electric (NYSE:GE). Then we have all those cool economic reports, and to top it all off, we have the release of the Apple (NASDAQ:AAPL) iPhone 3G into the wild. It will be simultaneously released to 22 countries.

So all this should really get things going. Are we working towards a rally, or are we hanging by a thread over the abyss? That is the question.

Disclosure: I hold a core position with AAPL. Although sometimes it's bigger, sometimes I pare it down based on market conditions.