Markets Rally Because The End of the World Was Already Priced In
Another ripper to the upside today. In Wednesdays post I noted "..the DOW is range bound from 11,700 to 12,700. Tightly bound. Almost supernatural! Until the DOW breaks either number in the range, the daily move makes no difference to me at all." Well that took two days! The DOW closed today at about 12,850 which is a breakout from the range I had set. I capitulate, and the bulls have win this round. I expect a rally going forward, maybe 2-3 months until next earnings season.
The accumulation of horrible news is astounding. The levity of markets and market players is equally astounding. it is like a drunken frat party where any idea is celebrated as great because everyone is so wasted. "No surprises", "Could have been worse", and "They didn't close the doors" are not exactly bullish sentiments. As for it all being "priced in", I would ask:
- With the indices only about 10% off the highs, is total failure and collapse only worth 10-20% less than the 3 year highs? Good question!
Oil raging, groceries raging. The dollar, gold, and the ten year bond all over the place. TED spreads up. LIBOR maybe fake. So much gyration!
I will try to make sense of it all this weekend. Now it is time for chilling.
Friday Night Entertainment
No suggestions for music/movies/pictures so I will just go for it.
Great Picture
This picture shows us that even a cat knows the economy is in the dumper!
see more crazy cat pics
Musical Interlude
With the general mood out there one of fun and euphoria, I will try to play some fun songs.
Lita Ford and "Kiss Me Deadly":
Totally rocking tune from Cinderella "Somebody Save Me":
A little softer tune, Cheap Trick with "The Flame". Great Vocals!:
The Bangles were a better band than they got credit for, and their version of "A Hazy Shade of Winter" is top notch:
Have a good night.
2 comments:
This bear is getting whacked but I had already priced in 1440 on the S&P and about 13k on the DOW short term up side. This market will have to break those on volume before I get to excited. Gap left at 1330 on the SPY will be a magnet on the way back down just like the one at 1440 will be on the way up. This may turn out to be sell in May and go away.
Kevin
Seems to me that the market is a chaotic system (as in chaos theory) and always will be. It also seems the big players have some influence in what amounts to a rigged system. They are not omnipotent, however. They may yet succumb to forces larger than themselves.
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