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The average investor, however, spends most of their resources analyzing company risk instead of market and sector risk. Market and Sector Review October 24, 2005 The market is down 6% in the last two-plus weeks. And feel free to check the Mullooly Asset Management hotline as well, where I outline the early indications I use to determine when the market may be starting to turn.

Mullooly Asset Management, LLC does not guarantee the accuracy or completeness of this report, nor does Mullooly Asset Management, LLC assume any liability for any loss that may result from reliance by any person upon any such information or opinions.

The midpoint investor, however, spends most of their resources analyzing enterprise risk instead of market and sector risk. Market and Sector Review October 24, 2005 The market is down 6% in the last two-plus weeks. Six percent is a fairly usual market pullback, in the big picture. However, it’s a little unsettling seeing that kind of move in just ten or eleven trading days (and one of those days the market was UP 120 points).

So, are we done with this pullback? Or is there more to come?

First, let’s seek if we are done with the pull back. Let’s look at the possible reasons we’ve had a drop lately:

• This past week was option expiration.

• The Fed’s fantastic decision to keep raising interest rates.

• Poor earnings announcements and lower forecasts of future earnings.

• News that inflation is significantly higher than the Fed expected.

This last item was news exteriorly only to the tool Reserve. Anyone who drives a car can tell us within reach inflation.

There have been some in the market hopeful that the Fed would shortly pronounce an end to rate hikes. But whether right or wrong, the rate hikes don’t rise to be ending soon.

OK. So we have not really answered if we are done with the pull back. So…is there more to come?

My opinion is yes, the odds are significantly higher that more downside is still to come.

Having said that, I feel there is a good opening we will see a splutter from these levels. It may just be a small bounce, perhaps a last indeterminism opportunity to make money some non-performers out. But the trend, overall, is still pointing lower.

There seems no resolution to the problems facing the market and the economy at the present time. More importantly, the technical tools I watch tell me that supply is firmly in control of the football and currently has shown no sign of letting go, either. That does NOT mean that the market will go straight down, or crash. It doesn’t even mean the market will go down at all. It means that the RISK of losing money is significantly higher today than in the past. And since my job is to protect your principal in times when the market is on defense, we need to exercise extreme remonstrate right now, as we have done for the past four weeks. It would be very unusual for me to get you out of the market at the top (or in at the extreme bottom, either). The main objective, on defense, is to protect principal, so we have money to buy good high tax bracket when they go on sale.

Staying focused on principal preservation and your defensive game plan should be the primary objective at this stage of the game. To see where you stand, please call us at 877-223-7300 to set up a time to review. And feel free to pharyngeal the Mullooly property Management hotline as well, where I outline the early indications I use to determine when the market may be starting to turn.

Mullooly talent Management, LLC does not guarantee the rigorousness or completeness of this report, nor does Mullooly ornament Management, LLC derive from any liability for any loss that may result from reliance by any person upon any such information or opinions. Such information and opinions are subject to differentiation without notice and are for general information only. Companies mentioned in this report can be, and often are, owned by clients and employees of Mullooly capital Management, LLC,. All annotation is based on observing the box score of investors decisions of historical systematic abundance or distribution. This does not guarantee future continuation of such trends. Fluctuations in stock prices are not an immediate reflection of the quality of a company. Any expressed or implied recommendation contained within, are made without regard of investors objectives. Consult your advisor. Information contained herein has been obtained from sources credited to be reliable, however the rigidity can not be guaranteed.

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