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MARKET WRAP UP 12/21/10
As the S&P 500 steadily moved higher today to finish up 0.60% to 1254, Mr. Market continues to dish out lessons to those that consider their analysis superior to the aggregate price discovery mechanism of the marketplace. Perhaps it is all one big house of cards, and perhaps there will, indeed, be a day of reckoning. However, that kind of mentality would have seen you miss virtually all of the 2003-2007 bull market, not to mention the bull run since March of 2009. So long as protective stop losses are respected, as well as sensibly locking in profits along the way, there really is no reason why those who consider themselves traders should not have been riding this prevailing trend higher.
As the updated daily charts of the leading indices and sectors illustrate below, the orderly consolidations last week are now resolving higher. As we close out 2010, the final act of this year might not feature a magnificent short squeeze so much as it could a panicky rush to chase stocks higher by chronically underinvested, “cautiously optimistic” bulls.
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