i don't think you are wrong but i don't agree with you. i will be the first to admit how the market keeps trading up with no weakness in site. my gutt just thinks its a perfect setup right now because there are no shorts, most economist have given up on economic data or sales from companies because of the fed money, and they are making it look just to easy to buy now. i stand by my feelings this week about my short call. i been a bear 200 points on the s&p on the economic side but this is totally a market call now. i don't believe that just because the fed is giving free money away that people will continue to buy the stock market with it. how much is a toyota corolla really worth paying for with a 0% interest?
(maybe I'm a bit off-topic,sorry) ... For example,the rich,smart and successful Warren Buffet has an opposite idea,and I certainly don't want to say that my ideas are better than his. But some time ago he said: "Now we don't need QE anymore" Now he says: "It would be great if Bernanke increased his 85 billion dollars per month QE" And he goes on: "You will surely see markets much higher than now;the key is conservation of profits". But he implicitly admits that these profits depend on QE, and that QE can control markets and economy without any important side effects. He may be perfectly right,but I'd be glad if he could explain why he's sure there will be no important side effects, and that the solution to any kind of problem in any market is simply: print and indefinite sum of money to make orders that will push that market "at appropriate levels".
Guys, don't wanna get in your discussion. But look, its not about economy, FED, news, reports or ... whatever its all technical .. we broke the 2007 high, they also broke the 1600 line which was kinda another break out. so its all the celebration of those things. now these are the short reasons : we are now on upper band of the channel. ( see the attached snapshot ) we have been on a straight shot from ES1370 its May ( not very important though ) what would you do if you were long ?
This is FREE money for longs!!!! How can you not have been long for years!!! Trend is higher!!! cash out up here, or higher, and retire!!! The FED told you during the trend.....we will buy!!!!! and you clowns shorted into that??? this was/is a once-in-a-lifetime long opportunity!!!! oh well......if you missed it.....get rid of all your TA!!!! lol
the technical side makes it melt up but you can't say the fed did not get us hear. that is why i won't argue with anyone that this market can't move higher. you are not buying stock today because sales will be better next quarter or economic news will be better next quarter that's all i am saying.
Sure it can make it higher .... no argue with that .. But when ? All I am saying is the we are now due for a correction and my not be lower that 1570 thats it bro
i think when it breaks it going to break really hard. the market is not about baby kisses but i would not be shocked to see 1700 and i would not be shocked to see 1400 easy. there will be no safe way of shorting this market and anyone who tells you going long is easier is 100% right. i think one day the market will be down 5% lightening fast than fear kicks in because everybody waiting for the correction won't pull the trigger so fast. than i think you get people looking at the market down 5% and take there gains off the table. than it goes lower than people who bought higher up see it ticking down and that's the sell off. the logic that everybody is going to buy until fed stops 85 billion per month than market tanks seems to easy. i know you can't time this, i know the market can go high, and i know you can only short small because market is strong.
another good post. I read some other messages on technicals vs fed etc i think there are many reasons for the rally and markets like this have existed before (with or without fed eq). but i think psychology will probably take over now for the next few weeks.. 1700 can easily happen but i don't think there are free lunches.. i saw many 'buy the dip' players up to weeks ago but even they started getting worried and calling it a top. in fact i don't know anyone who was long and picked up these last few points - so can only guess a short squeeze played a big part in it. and i don't think u can time the fed exit. how are all these buyers (who played the long side purely on the fed) going to exit? the only way is a crash like scenario.. in fact maybe that's the best way to preserve a value closer to recent highs? an orderly sell-off may go on forever and lose efforts of QE to establish a psychological ground in higher stock prices. but a crash could bounce quickly to levels which could be still very high - but with no QE. in any case anything is possible as we've witnessed over the past few months if not in history of markets.