There are bold pilots and old pilots, but there are no old bold pilots.  So said the Red Baron.  The aggressive buy signal we saw several days ago has been effectively canceled by the last three days.  Readers should have at the top of their consciousness until informed otherwise our recently reiterated remark (note alliteration) that signals seriously stink in these markets.

We are not even sure at this time of the truth of Schwager’s signal suppostion that a false signal canceled is a signal to take the trade in the opposite direction, but we remind you of it.  For our part we are abandoning the long trade we made, but not going short.  We will do that when the Wave Low stop is taken out.

We will be posting letters on silver and gold this weekend.  We think now that traders should be out of gold and silver.  Long term investors should be prepared for equity erosion (what on earth is that? (That means loss of  paper profits.))  (Note programmer’s use of parentheses.)

We will also be posting a letter to the edwards-magee google group (http://www.groups.google.com/group/edwards-magee ) that addresses economic conditions.  As a practice we do not comment on theoretical and economic questions in this letter. (Boring.  Irritating.  Enraging.)  But as the walrus said, the time has come to speak of cabbages and kings.