Forget About Chasing This Rally

This doesn’t look like March 2009, it looks more like the fall of 2010. In September, 2010 the S&P hit a higher low than in July 2010 creating a double bottom from which the market moved higher. On October 4th the S&P hit a lower low on smaller volume than the August low thereby creating a double bottom from which the market can move higher. The major indices are sitting above their 50 day ema’s, there are positive moving average crossovers and up days have more volume than down days. The technicals do support a move higher. You also assume the U.S. is heading into a recession which at this point in time is not a certainty. The problem with fundamentals is that it is just a story. If the story changes there go the fundamentals. Weiss Research is known for being perma-bears anyway. I don’t think MW has been bullish on the U.S. stock market at any time during the last decade even though it has made both huge moves up and down. Apparently he is waiting for a perfect world to materialize in order to give the bullish call. I suspect there will be a long, long wait before that happens.

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I guess you 2 guys held through the last collapse as well. I think we closed at under 1160 the day after Thanksgiving. July 21, 1998, the market was trading at 1190. Not many people have time to watch a screen all day and I would venture 80% of the bullish traders from 1998 are broke now. Sure you guys bought NFLX. How did that work. AAPL is starting to wilt as well. Half the governments in Europe are going to default in the next 12 to 18 months, taking down banks everywhere and ending the era of government inflation. Bernanke and Obama have hocked the lives of the next generation for a few more months of seeming recovery. Unemployment never fell below the levels we saw in March 2009. Corporate USA has been making money only out of Federal deficits.

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