This is simply amazing, anyone who thinks a rally of this sort can continue and continue and continue will be proven wrong, this is the best monthly gain in 37 years. Market rallies of this magnitude are extremely rare, if anything I still think this is a bear market rally, most can laugh at that opinion but that's where I stand on that. From what I have read this has a lot to do with POMO, there is approx $82 Billion worth pumped into the market since early October, this says a lot about this market rally. Dont be surprised when the markets fall a few percent in a single day, especially after a rally that hasnt been this strong in 37 years.
I think bear vs bull markets are almost outdated concepts at this late stage. The markets are entirely dependent upon the latest incarnations of the Government/Central Banker/I-Bank cartels. ESLF, IMF, TARP, QE1,2,3,4....Mark to fantasy accounting, TBTF banks, etc, etc...
Caught many/most by surprise... only now it rattled the maddening crowd to start throwing hard earned money into funds. Thus this could have legs. But just look at 2008-2009 (and I will confess I was (luckily) nowhere near the market or a TV when that happened)... why can't we have the same upside insanity. However not sure I am willing to bet on this continuing. So I might miss some easy profits. It's just when things seem so bad... it is not atypical for markets to rally in advance, figuring if they are at these levels with doom and gloom.. and a terrible economy, what levels will we see in 9 months - 2 years IF things turnaround. That is a classic paradigm or adage for markets... they look 6-9 months ahead. At least that's what I learned. They usually overshoot on the upside and down side. Now, how to trade all that analysis is not ever easy, or simple.
This is the time when ET "expert" will think that the market should go down and begin to SHORT. Good luck
i just don't see much downside here... 20-25 points on SPY - maybe. Don't see much more. Will be interesting to see if I am correct or if my analysis missed something. The problem is (for me) can you go long here?
Fed must have been buying futures in concertation with other central banks . Who else would buy ? Not retail and mutual funds : individual investors would have to be crazy to buy stocks given what happened in the past ten years, they swore stocks off a long time ago . Not hedgies; they were betting on the euro crisis and are mostly sheeps thus went with the trend that was down.