Markets took off yesterday shortly after the morning bell, as positive manufacturing reports for the U.S. and China bolstered investor confidence. The ISM Index found U.S. manufacturing grew in August to 56.6, up from 55.5 the previous month. The rally left the Nasdaq, S&P and Dow all up about 3% at the end of the trading day.
But is the rally here to stay, or is this just a bear market blip?
Barry Ritholtz of Fusion IQ and writer of The Big Picture blog, is taking it slow and just "legging in" to test the waters. He says that we are in a range market right now, and that the "key support" is 1040 on the S&P 500.
"We've traded down to that a dozen times, and you see on the chart that every time you hit that, we've bounced off of it." His forecast is that we will be trapped in this range for the "foreseeable future."
Using history as a guide, Ritholtz says stocks generally correct 20-30%, after a massive rally, like 2009's 82% rebound. So far, we're not there yet. Plus, it's his view we're still in a secular bear market which could last another four to six years.
That's not to say we can't have another bear market rally. Ritholtz hopes that the down days of August are over and tells Henry in this clip, "People think of September as the dangerous month, but when you have a real bad August, maybe it anticipates it and washes it out of the system."
One can only hope! Tell us what you think!
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Can you say poker face?
Please read the comment I wrote last Thursday telling peeps to buy. They covered me in pygmy spittle but it's all good. He who laughs last. I'm whistling a merry tune today : dingdong, the witch is dead. Where have all the doomers and dipsters gone? Just two weeks ago Gerald Celente, the grand Dragon of Doomers, was announcing the greatest of all depressions- riots, und so weiter. Peeps have forgotten how we got here from 11300. Doomers preaching the fall of the EU. Indicators now are more encouraging than when the Dow was 11300. Then why doesn't it go back? It will, and so fast it will make your head spin. Blue skies smiling on me. Nothing but blue skies do I see.
Russ Stahl, the Supreme Leader
Bear market is behind us and a fresh Bull will emerge! But this Bull will be soon slaughtered and made into hamburger for the masses with the steaks going to feed the sharks on wall street. The ebbs and flows are manipulated and created. These are not moral and honest people at wall street....remember Ivan Bosky, Michael Milken, Bernie Madoff, Carl Ichan , Marc Rich, Pinkus Green, Irv the liqudator Jacobs, Sir James Goldsmith
He does not know what he is talking about or he does and is not saying. The market will FALL and fall fast very soon. Cash or Short only
Newton's Third Law: "Actioni contrariam semper et æqualem esse reactionem: sive corporum duorum actiones in se mutuo semper esse æquales et in partes contrarias dirigi."
Or, in terms our Wall Street friends might better understand, "nothing's free".
But mostly I'm amazed at the capacity the "smarter than you" crowd has for declaring themselves just that, smarter than everyone else. All while they depend on everyone else to insure their own wild behavior.
As "the markets" recover, the Wall Street crowd, like Ritholtz, are taking a victory lap in their new Maseratis and passing out $million bonuses while the rest of us out here in flyover country are trading $80k/year careers for $10/hr and just trying to hang on.
I remember turning on the TV at work and watching the WTC fall in 2001. I happened to be "all cash" and my first reaction once the smoke cleared and before the markets reopened was to throw the cash back into equities with market orders only to spit in bin Laden's face and support my countrymen in NY. I think if the same event were to reoccur today, I'd be cheering bin Laden instead. How strange is that, how far have we come.
Wall Street moonshots while Main Street only sees tumbleweeds. I continue to be amazed at the disconnect between the two but I guess that's to be expected when one has unconditional government backstopping while the other is left to fend for itself. It's a shame the Wall Street backstop wasn't in place prior to March 09 when it might have done all of us some good instead of only a select few in NY.
The market is not doing well, don't kid yourself? The bailout nation is upon us all! Hardly a massive rally... Pitiful! The Dow approaches 14k, That is huge! I don't see that happening, so chill out on the hype! Thanks! Just wow... LMFAO! Where is the value in switching from bonds to stocks and churning accounts over and over again? That is not value, that is a kooky shell game, just kooky! Buy a cloud formation it will last longer than this hype! Just more wow!
I know. It's the "Empty Suit Omen"
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