Don’t Chase The Rally

From Michael Kahn’s Jan. 19 column at Barron’s:

It appears the stock market is finally firing on all burners despite a raft of problems still facing the global economy. … But don’t get complacent or enthusiastic about this rally. While stocks have pushed above short-term technical resistance levels, they are far from being in the clear. And I see no reason to alter my longer-term analysis that pointed to a tumble into the middle of the year. … Market cycles point lower while the ratio of buying-to-selling pressure suggests inherent weakness. The current short-term rally … does not look sustainable. It may be premature to sell the market, but preserving capital is still a good idea. Better buying opportunities still lie ahead.

From Anthony Mirhaydari’s Jan. 18 column at MSN Money:

It’s a false dawn not unlike the one seen in early 2008 before the meltdown started. The volatility behind all this is set to continue for at least a year. The good news is that we could see the return of a 1980s-1990s style secular uptrend for the stock market as soon as 2013.

From Mark Hulbert’s Jan. 18 column at MarketWatch:

Bullishness over the last 106 days has risen more rapidly than was the norm from past bull markets. … It’s worrisome when 3 out of 4 sentiment measures suggest that the bulls are jumping back on the bullish bandwagon at such an above-average pace. They reinforce the picture of complacency that the sentiment data have been painting in recent weeks.

This entry was posted in Stock Market Forecasts. Bookmark the permalink. Both comments and trackbacks are currently closed.


  1. Chris
    Posted January 21, 2012 at 5:29 am | Permalink

    Did you delete all of the comments on

    From Sunday’s Kelly Letter on 1/17/12?

    They are all gone now.

    • Posted January 21, 2012 at 9:43 am | Permalink

      We’re redesigning and moving things around. Comments are now per article, and we’re moving general discussions to the new Forum section where they’ll be easier to find, track, and so on. I hope to get historical comments left from the former general home page comments section into the new forum. I’ll post an article once the redesign is done. Thanks for checking!

  • Here are your three options:

    Option 1: Annual Subscription (no refunds)

    For just $200 per year, you’ll receive everything listed above to completely upgrade the way you manage your investments. This is 17% cheaper than the monthly option. This is what I recommend:

    Option 2:Monthly Subscription (no refunds)

    If you'd like to try The Kelly Letter  without paying the full year, you can pay $20 per month.

    Option 3:Free Email List

    If you'd like to hear more from me but aren't ready to part with any money yet, you're welcome to join my free email list:

    Join the free list

    Thank you for the work you do. You're a household name here and my wife and I often discuss your letters on Sundays. My ten- and seven-year-old children recognize your name and will eventually be taught to invest using 3Sig and 6Sig. You've had an enormously positive impact on our investing and inspired me to look at the world in more rational and clear terms than I did years ago. I'm sure that thousands of others would say the same. Kelly Letter subscriber Matt Barnes
    Matt Barnes
    Product Line Director

    Join Matt and thousands of other rational investors to invest without stress.

    Subscribe to The Kelly Letter  now!

Bestselling Financial Author