The whole sub-prime stuff is really starting to annoy me. The vast majority of companies out there are doing just fine and are looking forward to the benefits of a reduced interest rate environment. The market is aching to reward them as you could see in the pre-market on Friday. The inflation numbers gave encouragement that the Fed would have the leeway to lower rates and it looked like we would have a nice follow through to Thursday's action. Then along came the Bear story to once again spoil it for the rest of us.
Personally I think they should just let Bear Sterns sink, I don't think the affect on the market would have been any worse than Friday's bail out news. Let the people who made foolish decisions take their medicine, or force them to get together with their fellow conspirators, the greedy home buyers who thought they could get a nice home without having the money to pay for it, and come up with a solution. We offered them a solution, if they want our advice.
This remains a market thats hard to read or trade in, so unless you are very adept, it probably best to just watch a while longer. Once the financial mess gets cleared up a bit more, we should see a nice market rally. Our momentum indicators will tell you when that is happening. For the slow or long momentum indicator, we are still in neutral territory, telling us the market is fighting to get back on the long side, but its not there yet. The moderate momentum indicator was unaffected by the action on Friday and continued a nice move up, while slow momentum got bent downwards.
The coming week should be interesting with the Fed meeting and options expiration coming. Check out our Top 25 lists and our new TradeWinds Black Box picks.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment