The title of this piece sounds like some romantic novel but it is all about this stock market. Sometimes the going is easy, and sometimes the going is difficult. Right now we are in the latter as the S&P 500 is back in "The Range" (1040 to 1100); I am reading a lot of posts on various blogs on how random the action is and a lot of frustration since time frames for any pattern now are miniscule. The last 3 days are a great example.
Tuesday the indexes went from a large loss to a large gain on rumors of a Fed emergency cut in the interest rate held on reserves. That sort of reversal and close on the high should have been a big positive for the next session.
But by Wednesday it was completely forgotten as generally good earnings were "in the market", and traders sat around twiddling their thumbs until Ben Bernanke would come and deliver them to heaven. He did not, and a flat market turned into sharp losses post 2 PM. The previous day meant nothing, but a market that closes badly like that should bode poorly for the next day.
Alas, yesterday was forgotten as positive industrial news out of Europe has futures surging today. The "bad close" is a distant memory. Bernanke who? Interest rate reserve cut what?
And you expect anyone to hold positions in this environment? It's only in favor for daytraders who close out their books every day before 4 PM. The bipolar market with no memory from day to day only continues to grow in strength. [The Bipolar Market in 1 Chart]
Thursday, July 22, 2010
Every Day Onto Itself With No Memory of the Last
Best Of FMMF
- 1: Warren Buffet Piles on Europe
- 2: [Video] Jim Chanos Returns from Europe, Even More Bearish on China
- 3: A Chart to Open Our Eyes - Staggering Changes by Multinationals in Employment Behavior 00s vs 90s
- 4: Futures Blasted on Dexia Woes... and Poor Preliminary China Data
- 5: Market Working to Worst Thanksgiving Since 1932
- 6: Et Tu, German Bonds? Poor Auction Raises Eyebrows