Now What

The market is a tough call now that we got a reflex rally off of yesterday's drubbing. The bulls will say that we are heading into the turn of the month during a seasonally strong part of the year. The bears will say that there is still a lot of complacency in the market, evidenced by the fact that the call buyers have not missed a beat. Additionally, imbalances may be coming home to roost.

A turn of the month rally would likely make for an excellent short setup heading into the seasonally weak part of the year with complacency running high. The immediate future is a much tougher call.

2 comments:

Anonymous said...

Those 7 S&P points in 10 minutes on no news at the end of the day tell me everything I need to know. Shorts are the weak hands.

It might be bumpy but I think you will get better levels to sell into over the next few days.

JD

Anonymous said...

...and tack on another 7 S&P points on nothing more than 'no more bad news' overnight.

Unless we see very bad numbers or another downgrade we will be back at new highs in no time, maybe even by tomorrow's close.

I don't know who the buyers are but they are clearly still out there in force on every dip.

JD