Come on in Bears; the Water is Nice!
Although overnight indications had stocks down .5% two nights ago, by the time the closing bell rang, the major indices recouped all that and then some in yet another sign of resilience. It seems like every call and email I get and most conversations I have are with folks who have a very negative view of the markets. I continue to feel like I am on an island alone in my bullish view. The masses just dismiss the upside as nonsense with global terror and Europe on the verge of recession and Japan probably in recession now. When they finally throw in the towel and accept the bull, then I will become concerned that it’s almost over. I feel for my peers who watched stocks go down and did nothing. Then they watched stocks rally and did not nothing again. They keep waiting for the perfect set up that’s simply not coming.
Remember, price is the final arbiter! The most bullish thing a market can do is go up in the face of bad news. That certainly qualifies today. I know of no one who has pounded the table harder than I have that this bull market may be old and wrinkly, but definitely not dead. More all-time highs are ahead. Dow 20,000 by the end of next summer. Come on in bears, the water is nice!
Today and Friday are very strong seasonally for stocks. All that means is there is a higher likelihood of stocks closing up, even by a penny over the next two days. Oftentimes, the upside is unwound on Monday.
Finally, don’t forget that tax loss selling season is upon us.
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