Any recovery is better than not, but only some recoveries are sustainable. The ideal recovery would gain only 20-30 points on a daily basis for a long time, with heavy volume. (Heavy volume means lots of shares were traded, which usually means lots of people are buying and is very bullish.)
The Dow has moved more than 100 points each day, up or down, for 57 of the last 58 days . . . that ain't good!
Yesterday, the Dow rose a whopping 166 points but on the lowest volume in six weeks, only 3.6 billion shares, compared to this year's average of 4.4 billion. And, this ain't good either!
It looks like the sellers have just gotten tired of selling to the few buyers out there. It does not look like U.S. buyers have retured. More likely, foreign investors just like the relative safety of our market and have returned to the U.S. market. The two best performing stock markets in the world this year are the U.S. and Venezuela . . . ours because of its safety and Venezuela because that market is rigged.
One of my favorite billionaires is Wilbur Ross, primarily because of his wry sense of humor. He believes the U.S. is "over" the European crisis and ready to go up. I agree with him that economic data out of the U.S. has been better and better, but my read is that while the U.S. stock market is anxious to escape the burden of worries over Europe and return of the debt debate, it cannot escape the anxiety of politics.
This rally is obviously much more than a mere dead-cat bounce and is more likely a bear market rally. Some think the current rally is just anxiety exhaustion. Or, it may be the real thing -- a real "rip-your-face-off" bull market rally.
It would be nice to sell all stocks at the top and buy them back at the bottom, but that also requires perfect knowledge and more than a little luck. That's why I never make a 100% bet. As my uncertainty rises, my level of cash rises. I'm still not a believer this stock market recovery is sustainable. It is still better to miss 50% of a recovery than to catch 51% of a collapse.
The Dow has moved more than 100 points each day, up or down, for 57 of the last 58 days . . . that ain't good!
Yesterday, the Dow rose a whopping 166 points but on the lowest volume in six weeks, only 3.6 billion shares, compared to this year's average of 4.4 billion. And, this ain't good either!
It looks like the sellers have just gotten tired of selling to the few buyers out there. It does not look like U.S. buyers have retured. More likely, foreign investors just like the relative safety of our market and have returned to the U.S. market. The two best performing stock markets in the world this year are the U.S. and Venezuela . . . ours because of its safety and Venezuela because that market is rigged.
One of my favorite billionaires is Wilbur Ross, primarily because of his wry sense of humor. He believes the U.S. is "over" the European crisis and ready to go up. I agree with him that economic data out of the U.S. has been better and better, but my read is that while the U.S. stock market is anxious to escape the burden of worries over Europe and return of the debt debate, it cannot escape the anxiety of politics.
This rally is obviously much more than a mere dead-cat bounce and is more likely a bear market rally. Some think the current rally is just anxiety exhaustion. Or, it may be the real thing -- a real "rip-your-face-off" bull market rally.
It would be nice to sell all stocks at the top and buy them back at the bottom, but that also requires perfect knowledge and more than a little luck. That's why I never make a 100% bet. As my uncertainty rises, my level of cash rises. I'm still not a believer this stock market recovery is sustainable. It is still better to miss 50% of a recovery than to catch 51% of a collapse.
