Now that Hank and the Cavalry have come to the rescue of [[FNM]] $10.25 and [[FRE]] $7.75, we should see the market rally, much to the chagrin of the bears. And, because “da bears” so overjoyously kept adding to their short positions, like drunken sailors, it is possible that we could see a “mother” of all short covering rallies, so to speak.
As you know, it is Mr. Market’s job to embarrass and befuddled as many market participants as possible, so as to humble those who are wise in their own eyes. That includes you and me.
With all of the news piercing every corner of our brains, now, more than ever, is the time to focus on whatever flavor of technical analysis you prefer. You and I can’t possibly process all the news from CNBC and a papparazzi [sic], nor would we want to.
Even before Hank issued the edict, my indicators were pointing to some kind of bounce, as the market sentiment indicators were extremely oversold. I thought we would see the rally last week. But no, The PPT had to wait until this weekend, just to embarrass the bears and naysayers even more.
Market sentiment indicates now that downward momentum has fizzled. Broader market indicators looked stronger on Friday than Monday of last week, despite the Dow fuckery. Yes, a divergence.
Don’t put all your focus on the Dow. You’re going to miss what’s about to happen. This is still a stockpickers market. The broader market is consolidating for the next move, which looks like it’s going to be up.
We have reached an inflection point as of Friday, as we should see the market rally this week. All this was showing up before Hank and The PPT‘s “mortgage backstop” bingo party this weekend.
If I were you, here are some names that I’d look to:
[[GHM]] $80.07, [[CLF]] $109.41, [[POT]] $221.38, [[QCOM]] $48.33, [[NOV]] $83.12, [[FLIR]] $42.55, [[MEE]] $83.11, [[CF]] $159.05, [[MCF]] $92.15….
I’d also start to take the short hedges off the table. If tomorrow is up big, I’ll send the offense back on the field. More on that after tomorrow.
….WIP
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