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Rally May Only Be in 6th or 7th Inning, Ritholtz Says

Posted Sep 15, 2009 09:12am EDT by Heesun Wee in Investing, Products and Trends, Recession

Noted bear Barry Ritholtz of Fusion IQ has been bullish on the market since March. Stocks have clawed their way back above 1,000 for the S&P 500 and the question remains: How much more to go?

"There's nothing in the technicals that we look at that tell us we're done," says Ritholtz, who authors the popular blog, The Big Picture. "Based on history, which is no guarantee, we could be in the sixth or seventh inning of this rally, which means there still could be a ways to go."

But there are caveats including stubbornly cautious investor sentiment. Let's face it: A lot of us are on the sidelines (in cash), waiting for a shoe to drop.

But for investors willing to parse through the technical data and fundamentals, there are long-term buys. Ritholtz's firm is long Dell, FedEx and Starbucks, and made recent investments in Disney, Real Networks, Ulta Salon and -- surprise! -- Arch Coal. While coal and oil prices are off their highs, there's room for selective commodity plays, Ritholtz says.

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128 Comments

Terry
Terry - Tuesday September 15, 2009 09:20AM EDT

Sure sucker in some retail buyers now that big money pumped up the equities with taxpayer bailout money. VOTE OUT the INCUMBENTS in 2010.

Johnny Ike
Johnny Ike - Tuesday September 15, 2009 09:27AM EDT

My prediction is the Dow Jones will go up to 18,000 in five years...............Will I see Dow Jones 10,000.......Not long now..........Still the share is not overbought.................The value is still and fair..............Further to go this rally this Christmas not without set back on the way.........W- recovery...........adjust the porfolio and make money.........buy...........

Devin J
Devin J - Tuesday September 15, 2009 09:28AM EDT

Sounds about right... as soon as government spending, I mean forced taxpayer spending is over the real face of the market will show again. This is far from over and the worst hasn't come yet. Time to pick up a short position, its going to start soon. Get ready

Yahoo! Finance User
Yahoo! Finance User - Tuesday September 15, 2009 09:28AM EDT

I was long Arch Coal yesterday.. for about 20 minutes.. maybe I'll short it today for 15 minutes if the opportunity presents itself...

Terry
Terry - Tuesday September 15, 2009 09:35AM EDT

It's amazing how the reporters don't or won't see the big picture. The Retail Sales reported today neglected to mention that the retailers are selling goods with a decreased margin just to get sales. This means that the bottom line (profit) is not any better. It seems that the reporters are negligent or morons in how they skew the news to fit their objectives. This is not journalism it's opinion. VOTE OUT the INCUMBENTS in 2010.

Austin
Austin - Tuesday September 15, 2009 09:36AM EDT

Terry (the first reader comment) sums it all up in two short sentences. Simple, easy and a cure all. At least someone sees through the cloud of dust.

donfurio
donfurio - Tuesday September 15, 2009 09:37AM EDT

wow Task finally admitted he was wrong, too bad a lot of people listened to him, not me at least

VTX1300
VTX1300 - Tuesday September 15, 2009 09:37AM EDT

Well........ Sure the market has rallied significantly from the March lows. But what has driven this rise? Increased earnings? Incresing sales? OOOPS... none of the above. How about government spending. Ding.. Ding... Ding.... Ding. The consumer represents 70% of the economy and the real unemployment rate is nearing 17% with no appreciable slowing. Hummmmmmm... Makes you wonder when this 'buble' will burst?

Devin J
Devin J - Tuesday September 15, 2009 09:38AM EDT

All of the people using these comment sections to advertise their websites are hypocrites. If they would use revenues to pay for real advertising it would help generate revenues for other companies. Instead they like to come to Teck Ticker and other sites to complain and push their bear opinions when they are contributing. Pathetic

williamm
williamm - Tuesday September 15, 2009 09:39AM EDT

Thank you, Chicken Littles!

taopraxis
taopraxis - Tuesday September 15, 2009 09:44AM EDT

I read an article the other day that said investor surveys showed people "stayed the course" throughout the crash. In a word, they did "nothing", the article said. Then, in the very next paragraph, the writer opined that the rally would soon start drawing the trillions of dollars on the sidelines "back into stocks", apparently oblivious to the obvious contradiction. The stock market today is essentially a casino...easy come, easy go. Really, who knows what any of that paper is actually worth? Follow the touts and bet your future on a paper pyramid and you very likely will get exactly what you deserve.

Evermake
Evermake - Tuesday September 15, 2009 09:46AM EDT

FDIC (the Federal Deposit Insurance Corporation) and JPM (JP Morgan) prior to the seizure of Washington Mutual bank. Shareholders contend: 1) that these actions were unjustified 2) that they were unethical 3) that Washington Mutual Bank was not failing. As evidence of our claims, reports now surfacing indicate the liquidity of the bank was much better than the public was led to believe; by most accounts, the bank had enough funds to cover the withdrawals by depositors. Washington Mutual executives knew these facts; however, their claims made days before the seizure that the bank was in good health were ignored. We the concerned shareholders of WAMU contend that the FDIC was not right in doing so and has caused irreparable harm to the WAMU stockholders, to the banking community and to the markets in general. As a result of this action, shareholders of thousands of companies throughout the world have lost trillions of dollars since.

james b
james b - Tuesday September 15, 2009 09:47AM EDT

the sugar coating is starting to wear off , the numbers are going to start to go bad and i doubt 10,000 where are the improvements? really? i hear some pretty big layoffs coming again as companies still trying to trim down , whats the failed bank nos. so far 87 and going way up this fall the fed is scrambling for buyers now , no its far from over we are more likely in 3-4 th inning and congress isn't coming up with much yet but damage control ,,, and health care .. wheres the health care for the economy boys you are doing a bang up job on that huh.

JJ
JJ - Tuesday September 15, 2009 09:50AM EDT

It is time to buy. The bears on this board have lost everything and are trying to come up with anything they can to make it seem like the market is coming back down. Buy, buy, buy!!!

harshing_my_mellow
harshing_my_mellow - Tuesday September 15, 2009 10:00AM EDT

Technicals... fundamentals ... who uses them anymore when you have INFOMERCIALS taking all that pain and frustration away from you ... sure, yeah, gloomers and doomers and chicken littles all talking at once because the streets are paved with gold and mana from heaven is falling upon us... This little exercise since March is what Moses did to his followers.... These new regulations being bantered around are the stone tablets and we are all going to be in the land of milk and honey soon.... Sure, read about Moses and his journey and what he once he got there.... make while you can people.

harshing_my_mellow
harshing_my_mellow - Tuesday September 15, 2009 10:03AM EDT

Things are so good Best Buy just missed the mark but were better than expected and not as bad as one would want to believe and there is still light at the end of the tunnel and everything is coming up daiseys while the roses are in bloom.

Len T
Len T - Tuesday September 15, 2009 10:09AM EDT

Follow the trend and the heck with the experts. Half the pundits say it will keep going up and the other half say it will be going down. Nobody knows.

san
san - Tuesday September 15, 2009 10:12AM EDT

It looks like it wants to roll over to the downside. Earnings are low so P/E are high. Unless there are some stonking earnings reports why should it go higher?

sensey
sensey - Tuesday September 15, 2009 10:16AM EDT

Melia is in agreement with Mr Ritholtz. The rally could well run some more, but I am still expecting an intermediate correction - which we need, so we can reload the turrets and blast away with our favorite names. Calling tops is very tough (you don't know it was a top until well afterward), so this is why we have to let our profits run and protect them with stops (which you can loosen or tighten as conditions warrant). ///////// /////////// Finally a TT interview actually dealing with financial matters - I'm sick of having to defend capitalism against the likes of Krugman and Galbraith (the know-nothing "perfessers") in this age of the government looter. But I do recall one Maynard Keynes quote worth repeating: "the market remain irrational longer than you can remain solvent." So don't fight the tape.

giraffes
giraffes - Tuesday September 15, 2009 10:18AM EDT

Selective commodities plays? Sure... although of course you make it sound like there's about two. A false picture of weakness. There's thousands.

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