The stock market is playing with us lately. We are “doing work” around the Dow 11k/SPX 1180/Nasdaq 2500 area. In fact, we have been around this area since OCTOBER 4th! In all that time, there have been some great up days and some damaging down days. But like other times since the end of QEI, there is little follow-through.
We know that we live in “Bizzaro Market” where everything is backwards. We also live in a time where traditional technical analysis does not work. Since the market structure has been warped and perverted, so must our analysis of time and price. The caveat is that traditional metrics DO work, sometimes, just not the stuff that most are looking at.
Right now is the time of year reserved for optimists. But there is a plethora of nasty things out there that could be larger than any wall of worry. There is also the perception and new consensus that things are getting better for our economy. They are just seasonal and you’ll know that at the end of the first quarter of 2011.
But this is AMERICA dammit! No bullshit Euro-trash is going to keep us down and neither will the Chinese machine slow our holiday consumption. In fact, they are getting ready to open the spigots again after this brief “pause that refreshes”. Just keep your eyes on copper.
Today is the first day back from the long holiday and it is dominated not by “us”, but by the visiting team. You know, the nervous Euros and the fearful Asians, both having a crisis of their own. With low volume, it is a lock to get the market recovering in the afternoon as the foreign business is done in the morning. Also, on my live video show this morning, I chatted about a “morning dip and and afternoon comeback”
The month end/beginning is a powerful time for asset allocation strategies. Markets have held their up-trend. The bias is to the upside. BUT after that will be tax-loss selling, profit taking and my guess is that there could be a very large rush to beat the new and higher capital gains and dividend taxes. Get ready…
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even w/ all the technical issues, fantastic morning commentary on show this morning. it still amazes me how you nail the action for the day in the first 30 minutes. we might not technically close positive but close enough. have you considered ever doing a quick 5-10 minute post market video segment?
Good call dude.
The market should go higher like you’ve been saying….it should. But, im worried it won’t. Contagion seems to be spreading in europe….the problems are getting more difficult to fix. How are they going to put the rabbit back in the hat now that portugal and others are starting to get targeted? How long can the US market ignore that?
I don’t see how we retest the highs with the euro problems spinning out of control….
I think, maybe, it all rides on when/if the bush tax cuts get extended….i suppose when/if that happens, the market will rally like hell.
tricky times…