Sick and Tired of Being Sick and Tired
"I'm sick and tired of being sick and tired; I used to go to bed so high and wired" -Ozzy, I Just Want You
This morning started off shaky for markets and the S&P 500 quickly fell to 1074, which was about 9 points higher than the 1065 I mentioned last night as a long term support area. Things rallied from there, but later in the day the all too familiar fade came, and things started looking very bad. Then what?
Markets exploded higher going into the close in a wild move of panic buying. There were some rumors of Euro banking bailouts and all that but it just seemed like shorts had packed it in for the day and maybe everyone was just sick of feeling sick about the markets.
I still have not seen the kind of wash out capitulation that would make me super constructive on things, and we may never get one at this rate. This action is not healthy, but it is what it is. Can it last a few days? I think it could and I even made a buy today.
I have been watching the stock NI for some time. Here is a daily chart and you can see the reversal candle today right at $20.50 which is a key price for this stock:
In case you want to get all glassy eyed and party with this market, I would point you to one of the best essay's I have ever read which was published today. Josh Brown's "Season of the Witch" is the absolute must read for anyone here. Small snippet:
Now there are those who look at the recent data and say that it is only a slowing of growth, not an actual economic contraction. "So what if year-over-year GDP declines below 2%," they'll say. My response is that they may be right - but they should be aware that every single instance of Y-O-Y GDP growth slipping beneath 2% since 1948 has led to a recession. Every single time we've slowed down to this extent in the last 60 years we've gone down to the zero line (11 instances) and into negative territory (10 instances). The ship is not so easily turned.This earnings season upcoming will be the final arbiter for how active I want to be in the markets going forward. Sick of feeling sick about the market? I understand, and maybe a rally will improve morale out there. Just don't forget there is some important information coming soon that demands your attention.
Have a good night.