I know there are rather strong words but I was basically right about Friday's rally on the good payroll numbers. My premise was that there was no fundamental basis for the rally-it was just a short term relief rally-as everyone already knew that the fundamentals of the US economy are strong. The problems like elsewhere-Russia, the Ukraine, Europe, a slowing China, what Jim Cramer calls a bear market in commodities.
http://diaryofarepublicanhater.blogspot.com/2014/10/what-september-nonfarm-payroll-surprise.html
Today the market again went up like a rocket ship after the Fed promised that it wasn't married to raising interest rates in some knee jerk way but this planned rise would be 'data dependent.' This was enough for the market to rise to its strongest day of the year with all sectors rising. I did happily buy some BAC calls when it was at $16.80 and it closed at $17.12. Still I rang the register on XLE puts this morning then bought some more at a lower strike price. I don't see how the Fed promising to be data dependent rescues oil and gas prices as they aren't dropping due to worry that the Fed won't be data dependent.
I got a rather unexpected confirmation of my sense that today's rally like Friday's is something of a false flag when Jim Cramer, of all people, suggests that today was indeed just a relief rally as the problems in Europe are hardly solved by anything the Fed said or can say-though maybe it could be helped more by what Mario Draghii conceivably could say.
He then said that based on what the charts say, it looks like there is more downside in the market-the S&P fell beneath it's 100 day moving average yesterday but it finished today beneath long term support at 1980. The analysis makes sense but I have to admit that I find it more compelling precisely because of who is saying it. Cramer is anything but a permabear, a Cassandra who has predicted '10 of the last 4 recessions.'
I have to imagine that the selling may well not be done yet.
UPDATE: Here is the link for Cramer's cautionary words. Taking this show with his previous show, he's been very bearish which is very notable for him as he's mostly a permabull if anything.
http://www.cnbc.com/id/102072226?trknav=homestack:topnews:3
http://diaryofarepublicanhater.blogspot.com/2014/10/what-september-nonfarm-payroll-surprise.html
Today the market again went up like a rocket ship after the Fed promised that it wasn't married to raising interest rates in some knee jerk way but this planned rise would be 'data dependent.' This was enough for the market to rise to its strongest day of the year with all sectors rising. I did happily buy some BAC calls when it was at $16.80 and it closed at $17.12. Still I rang the register on XLE puts this morning then bought some more at a lower strike price. I don't see how the Fed promising to be data dependent rescues oil and gas prices as they aren't dropping due to worry that the Fed won't be data dependent.
I got a rather unexpected confirmation of my sense that today's rally like Friday's is something of a false flag when Jim Cramer, of all people, suggests that today was indeed just a relief rally as the problems in Europe are hardly solved by anything the Fed said or can say-though maybe it could be helped more by what Mario Draghii conceivably could say.
He then said that based on what the charts say, it looks like there is more downside in the market-the S&P fell beneath it's 100 day moving average yesterday but it finished today beneath long term support at 1980. The analysis makes sense but I have to admit that I find it more compelling precisely because of who is saying it. Cramer is anything but a permabear, a Cassandra who has predicted '10 of the last 4 recessions.'
I have to imagine that the selling may well not be done yet.
UPDATE: Here is the link for Cramer's cautionary words. Taking this show with his previous show, he's been very bearish which is very notable for him as he's mostly a permabull if anything.
http://www.cnbc.com/id/102072226?trknav=homestack:topnews:3
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