Everywhere you look, people are debating whether last Monday’s S&P; 500 plunge of 8.8% combined with yesterday’s 8.3% loss at the lows and 3.8% loss at the close is the capitulation we need to call a bottom. Was the last-hour recovery yesterday a sign that the tide has turned?
Here’s a round-up:
“Presently the latter situation envelops the market. There are at least $4 trillion in cash now on the sidelines plus a couple trillion more in newly printed fiat money from the treasuries of governments around the world. There is sufficient cash to feed the Bull.”
“However, being even one day off in timing during such times can spell disaster to a portfolio whether you are a professional trader or casual investor. For that reason, sitting on the sidelines is the best advice I can give. After the market finally finds its bottom, missing the first few weeks of the new rally won’t really matter in the long run.”
“The market down 30%, the VIX spiking to 56, and Cramer giving a panicky SELL on TV this morning. We have a 9,500 downside target, and the likelihood of an emergency action makes us want to get long — at least for a trade . . .
“We are putting a toe in the water here.”
“As you might imagine, the sentiment and technical indicators are literally off the charts suggesting we’re going to see a big-time counter-trend reversal sooner rather than later. As in life and the market, there are no guarantees but when you see readings of this nature, that is pretty much as close as you are going to get unless the world and the market are about to come to their bitter end.
“Beyond the obvious, the best thing to say about the market is that at least no one expects anything good to come from earnings season this time around. And, as far as hope for the Fed and Plunge Protection Team, well, you can forget about that as well. The action over the past few days shows us many fear the world is headed for a complete collapse and anything short of that will be a positive surprise. All in all, at a minimum, it’s time to start thinking about what can go right for a change because no one else is.
“There are no equity indicators at extremes that are offering bearish readings right now. Not a single one.”
Look insideThe Kelly Letter
Your email is never published nor shared. Required fields are marked *
You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>
<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>