I do not think it is very important to know the reason at this point . What is important to know is that the current mood of the market is very positive. So , somehwat, the news are seen as good. The mood of the market is more important to know than interpreting its reaction. I will always remember in 2002, when I was painfully long the market and watching CNBC (I do not anymore !), Pisani, responding to a question about why the market was going down said: "Well I asked many traders why they keep shorting this market and they answered: BECAUSE IT WORKS !." Sometimes , myself including, we make things too complicated.
1.) Potential OPEC production cuts bullish for Energy Sector which is screaming out of an oversold condition. The energy weighting is a decent chunk of the S&P. 2.) Earnings from Brokerage companies like Bear Stearns this morning reporting +38% increase in 4th Q profit. 3.) AMD announces that their merger with ATI is give them increased cost savings to the tune of $80-$160 million. 4.) Unemployment claims this morning, plunged for a second straight week - - - signalling that the Economy may not be cooling as quickly as some investors had feared. These are this morning's news items just to name a few. Market environment has been positive for many weeks now, so has the TREND. People trying to pick a top the week of triple witch are just asking for trouble, especially on a day like this where there were numerous NEWS ITEMS for Wall Street Bulls to run with. My initial target ( as posted in the Technical Analysis Forum )remains 1439 SPX, with an initial target of 1425. Getting close.
The dow is clearly showing weakness, the bulls look tired, but until we have some strong distribution days the RSI could return to 70-80 and void that divergence. You just never know what will happen.
If you were watching the Semis (SMH) you could have seen the move coming from a mile away. Why fight the government? they're giving away candy. Take it and enjoy.
Does anyone really believe that we will have the Amero? It seems to me that greatest export the US has ever given the world is the American dollar.
Ok Lets see.... 1.) Potential OPEC production cuts bullish for Energy Sector which is screaming out of an oversold condition. The energy weighting is a decent chunk of the S&P. High oil prices would not cause a fast/huge move off the open....If you watch CL vs SPH everyday you will see there really isnt a short term correlation.... 2.) Earnings from Brokerage companies like Bear Stearns this morning reporting +38% increase in 4th Q profit. Earnings from ONE company...let alone a bunch is not gonna cause the move we got this morning....todays move was one of the bigger recent surges....how many times do we see a big company miss/blow out earnings and the Sp's are up .25 ? 3.) AMD announces that their merger with ATI is give them increased cost savings to the tune of $80-$160 million. Come on man..you are reaching.....AMD ?????????? 4.) Unemployment claims this morning, plunged for a second straight week - - - signalling that the Economy may not be cooling as quickly as some investors had feared. The weekly claims report is insignificant.....always has been... These same 3 things can happen next Thursday and the sp's could sell off 15 pts..... Higher energy prices...bad for economy...sell off (IMHO a big part of the rally up was CL falling 20 bucks from its high...not sure how a rebound would be bullish) Earnings reports really dont have a big impact on the whole index... Savings from a merger.....means nada Claims plunging...uh oh.....economy isnt so bad...wont get that rate cut....maybe even a rate rise....sell off My point is...there was absolutely no news that caused todays big surge on the open....most likely option related...
I thought you were done for the year.....closing the books...outta here...bon voyage..... back so soon?