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Pleasant Start

January 3, 2011 – 6:02 pm

The first trading day of the new year is starting out to be very positive. There was no new news at the open to push it higher as traders return from vacations.

As traders return and start to look forward to earnings season starting this week and as they study the economic numbers gauging the strength and direction of the economy they will and already have pushed money into those equities they think will work in 2011. Mutual funds with their maneuvers at the end of the year start to make their bets for the coming year. Tax loss selling and portfolio massaging are now over.

The stock market is not overvalued and it appears the economy is improving. So at least for the time being the stars are aligned for the new year as corporate profits continue to increase. We will see some falling stars at some point this year and there may be a number of them crashing to the earth, but doesn’t that always happen every year?

Good Trading

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