Wednesday, April 8th, 2009
The market appears to be giving back some of the recent gains but with reluctance. Most traders and investors expect a pullback from the recent steep rise and because they expect it they will likely make it happen.
However, earnings season is starting in earnest and it is getting in the way. Built in to stock prices is an expectation of very poor earnings so any outlook of future earnings that are reported as less draconian might push the market higher. On the flip side any reports that point to worse numbers may or may not affect the market because expectations are very low. This is going to be a confusing time.
This morning there was a very large merger in the home building industry and Alcoa reported bad numbers for the first quarter but the stock is up on expectations of better times ahead. The market was up this morning but weakly after being down strongly yesterday on the fear of bad earnings.
As I said, this earnings season is going to be confusing.
Good Trading
Steve Peasley
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Friday, April 3rd, 2009
The main news item this morning was the official jobs report for March. There were 633,000 jobs lost raising the unemployment rate to 8.5%. This was a little better than expected but a non event for the stock market.
Economic numbers continue to show us that we are in a slump. However, those numbers, while weak, are revealing a slowing in the economic fall. That alone has sparked a rally. This rally is a Bear market rally. Usually a 20% move from a bottom is considered a change to a Bull market. That is what we have seen. It is hard to feel all that comfortable because we had a 25% collapse in the market the first two months of the year and in the beginning of March it continued to fall until the third week. Then we had almost three weeks of an up market producing a ‘V’ bottom. Technically we are in a Bull market.
You can not fight the tape. The market is rallying. That is a fact and you have to ride it as far as it will go. Stock prices are still very low for those companies that have earnings.
Fear is subsiding. That is a good thing; therefore maybe this bull rally has further to go.
Good Trading
Steve Peasley
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Wednesday, March 18th, 2009
Think Outside
the ‘Stocks’
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