Today’s rally was probably a combination of bad news not as bad as usual, and the beginning of the new quarter. The day after my last portfolio update, gold continued to decline abruptly and seeing the cracks in the bull market, I used a small Gold rally I saw as temporary to liquidate my IAU positions with a small profit on Wednesday 26. I am happy I did (I should have sticked to my initial thought that the commodity bull market is taking a deep breath). I did the same with my FXY at a small loss. I have been since then ~20% stocks (mostly AAPL and GOOG) and 80% cash USD, expecting both a short-term rally in the USD and also a short-term rally in equities, explained by market participants thinking that the worst is over, or that the Wall Street crisis won’t affect Main Street as much as priced in.AAPL did well the last month and a half (+20% since the mid-February low) and I am happy to have held on. I entered at around $135 and I’m now well in the red (+10%). This is partly thanks to the general recent market enthousiasm and partly thanks to the rumors around the 3G iPhone and of price reductions of the current model. I think the latter will be a great move. I don’t understand why Apple hasn’t been democratizing its offering with entry products that more people can afford, especially at the time we are now clearly entering a slow down. I think a sub $300 iPhone will allow people with a lower budget than current owners to finally get what they wanted for more than a year. BTW, did you know that Brazil taxes 100% imported electronics, making the MacBook Pro a >R$ 10K-12K luxury almost nobody can afford.Anyway, I’m still bearish for U.S. equities for the rest of the year, but I know that bear markets don’t go in a straight down line, and that we might be experiencing a temporary bull market. As a resuslt, I am going to watch more carefully the action tomorrow and the rest of the week. SKF (ultrashort financials) was down almost 15% today, SDS (ultrashort S&P500) was down more than 7%, which tells me that it might soon be time to buy shorts again. My portfolio is up 6.5% YTD in USD, and -0.6% in EUR.