A Scary Time…….updated….Twice
For more than one reason, things are scary.Â Capitulation periods always make investors nervous.Â In our opinion the low for the year in the stock market is five to ten days ahead, but the problem areas of the market will push the market much lower during this period.Â WhatÂ ever one does, you will feel pressure. What if we are wrong and yesterday was the bottom and you are out of the market or even short.Â Things to think about, but on the otherhand you don’t want to be a seller a 150 points lower on the S&P.
John Mauldin’s market views which I have pointed out many times (link on this site) has a very thought provoking “Outside the Box” letter this week. It is by Van Hoisington and Dr. Lacy Hunt and bascially says that the relatively low bond yields we see in the bond market are a warning that deflation is waiting in the wings.Â If you cannot get the letter, email me and I will send it out to you.
8:14 AM CDT
Yesterday overhead resistance on the S&P 500 came in at 1273, today it comes in at 1261.
11:20 AM CDT
This late rally went back to yesterdays highs, surprising, but Paulson is trying to put some spin on the situation, doesn’t change anything.Â We took the rally asÂ an opportunity to dump most of the financial stocks we bought recently.
2:42 PM CDT
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