The professional hazards of blogging. Boy was I wrong yesterday. Not only did things reverse but they reversed with a vengeance. The frustrating thing was, I had no idea why. I woke up this morning and do what I normally do. Roll over in bed, grab my blackberry, and scroll through the headlines. I look at the headlines, and I said to myself, eww, we are going to be down today. Than I looked at futures which were screaming and do a double take. I am like, I most have missed something. Go back through the headlines only to see the same bearish headlines I saw before. German survey well below what was expected, U.S. small business survey just abysmal, Portugal downgraded, Asia down the previous night with China really getting nailed, and some bad numbers out of the UK. By noon I just wanted to punch something, so I went and worked out. :)
Anyway, I have no idea what sparked the rally today. Alcoa lagged the markets. CSX whose earnings were also talked about was down. Maybe it was all a lead into Intel. Intel's numbers were truly amazing. Even as a bear, I must admit they were solid on every single framework.
The bears were getting their heart ripped out. I heard from all my bear friends who I don't hear from unless they are getting squeezed to death. What that means of course is a capitulation on the bear side. That doesn't mean the market will start going down as it isn't a capitulation to buy as much as a capitulation just to get out of shorts.
I hate this market. I hate everything about this market. I hate when I am making money. I hate when I am losing money. There is no rhyme or reason for anything. It is straight up or straight down. Has been for months. The market is broken. Just entirely broken.
We are now as much overbought as we were oversold 2 weeks ago. That is incredible. 7 days, up about 9%. ON NOTHING. No major economic news as the last two weeks has sort of been a quiet period for economic news. The news that has come out has been neutral to bad UNTIL the Intel numbers today. That was legitimate good news. So you could say all the bad stuff is priced in. Great, but the market shouldn't go up 9% in 7 days going to extreme overbought territory. That just isn't healthy even if your a bull. It is just absurd.
So where do we go from here (after my thoughts from yesterday, you probably shouldn't read this part)? I don't really know. Odds are high for some sort of pullback ASAP because we are so oversold but because of Intel the market may be up strong tomorrow exacerbating the situation. 1105 is important. We are at the 50 dma. The 200 dma is above around 1110. At this point after a pullback I could easily see us going to 1140. We may not. The market is really schizo right now. Not much makes alot of sense and from an investor standpoint I don't think there is alot to do. Is the economy slowing or isn't. So many warning signs that it is.
One other point. Again, copper underperformed today. It was basically flat on the day when the dollar was getting pummelled and other commodities and the market was screaming. It may be nothing but I still look at it as at least a warning sign.