Why is the stock market going up if it is supposed to go down.? I mean every economy has been hit, the war, the price of oil, gold, subprime.... u name it.... Is it going up just temporarily? Why did mbi and bak rallied up so fast? Why mer is going up after reporting big losses? It all doesnt make sence... I know that rate cuts can help, but not this. All the economies went down after bush's message, and now ours is going up. Are people really believeing that his plan will work? Inflation is going to kill the dollar? Now people are saying that soros is beeting against tjhe dollar or something. Im just so cofused. feel free to leave your opinion. Sry for my english
The market is not supposed to do anything. A trader trades what he sees, he does not worry about why things are not going according to an obvious plan.
My suggestion to you is: Don't trade. From your post it is clear that you have no understanding how the stock market works. The last days have been a textbook example how to take the money from the weak hands and put it into the pockets of the big guys who sold and shorted bank stocks one year ago when earnings where great and everything was so bright. Remember: The view is always brightest at the top ! Now its time to buy bank stocks and homebuilders again and the smart money already did it last 2 days.
So we are in a bottom of the financial markets? What about the big ressesion that people were talking about?
recession is coming but we know that since 4 months now. Priced in. Please take a look at S&P charts of the last recession. There is a good indicator. Its how often the word "recession" is printed in the typical media like internet, newspaper etc. It always was a time to BUY when this value reached a high value. The stock market will chop around this level until May and then we see a rally into end of the year.
This is an ideal trading environment. Lots of EV out there both directions. Just stay choppy and volatile. When you think its free and clear bull donkey run, you should probably sell. Don't get caught in the hype. Sell the greed, buy the fear.
G'day IcyTrade and everyone else. I'm new to this site so go easy on me. IcyTrade, my take on the situation is the market just bounced off long term support established back in January 2000. I follow the charts, long and short term, and try not to look too much into the media. Cheers.
Sometimes I find it convenient to think of the behavior of prices in terms of market dynamics. When the sellers are finished selling the psychology is still negative. I might expect prices to change to lesser values. If the sellers are already sold out then transaction volume at lesser prices is zero or near zero. The market makers are looking for transaction volume. If a little buying enters the marketplace then transactions are recorded at greater price values. Once price values begin increasing then some traders buy, the rally continues to record greater price values and increasing transaction volume. I find market logic and Staidlmayer's writings to be useful conceptual works.