The way I see it, we have two different scenarios happening in the stock market today.

Scenario 1: Contrary to what you may have read or heard from other market watchers, I do not believe the general stock market is in correction mode. In my opinion, the general stock market (which includes big cap and blue chip stocks) has been in a bear market since the year 2000.

If you look at my beginning of my year 2006 predictions, I had predicted 2006 would be another down year for stocks. In that prediction, I also stated that I expected this year to be the sixth consecutive year the popular Dow Jones Industrial Average would fail to rally above its record high set in early 2000. As of yesterday, the Dow Jones Industrial average is down 2% for 2006.

Bottom line on big cap and blue chip stocks for me: not a correction, but an ongoing bear market that started in the year 2000.

Scenario 2: Contrary to what others are saying about gold stocks and precious metals (that the bull market is over for metals), I see the current action in the precious metals market as a correction within the confines of a long-term bull market. I have written many times that no investment goes straight up in price without a correction somewhere along that upward line.

And that's exactly what I see happening in the gold market. Gold bullion had moved from $250 U.S. per ounce to $732. I've recently written that I expect the correction in the precious metals market to take gold to $575 U.S. an ounce--and that's close to where gold closed yesterday. I see gold bottoming out. If gold moves to $500 U.S. per ounce, gold will have corrected 50% of the gain it made from $250 U.S. per ounce to $732 U.S. per ounce... a very healthy correction. But, the price and volume movement of the major gold producer shares over the past few days tells me we could be very close to a gold bullion bottom right now.

Bottom line on gold stocks--not an end to the bull market but a long overdue price correction that I feel is close to complete.