Why I Feel Better Now
Gary Kaltbaum is an investment adviser with over 18 years experience, and a Fox News Channel Business Contributor. Gary is the author of The Investors Edge. Mr. Kaltbaum is also the host of the nationally syndicated radio show “Investors Edge” on over 50 radio stations. Gary is also editor and publisher of “Gary Kaltbaum’s Trendwatch”… a weekly and monthly technical analysis research report for the institutional investor. If you would like a free trial to Gary’s Daily Market Alerts click here or call 888.484.8220 ext. 1.
Ben Bernanke on 60 MINUTES now says the economy will get better by end of this year. Gee… I feel better. You may want to go back to all his quotes of the past 3 years. There has never been a man so wrong for so long. I just want to know one thing. Did Mrs. Bernanke come up with the questions? The most important questions were not asked. Hey Ben, how the heck did you miss 100% of these problems? You are the Fed chairman. What is your talent if not being able to see the problems ahead?
Barack Obama finally received good advice. This politician changed his rhetoric almost 180. Ah… everything is now all better. The end of the world is, all of a sudden, not going to come. Yup… hope and change. Nope… just another politician changing his stance based on poll numbers.
AIG… hey, can I go work for AIG? Failure, fraud and criminal acts have never paid so well. But everyone is missing the point. All this bonus talk is just masking the real story. AIG was the biggest fraud in history: a company that insured a massive amount of stuff without the capital to pay it off if things went wrong. This company took massive amounts of fees based on this fraud… but so far… not one indictment.
Bernie Madoff…This is the only time I wish this was Iran. I hear they cut your hands off just for stealing. One cannot know what is inside this man to do what he did. Please let him out in the yard!
Removal of toxic assets? OK… and how does that make things better? Aren’t toxic assets still toxic assets whichever room you put them in?
Uptick rule? Yup…the uptick rule really helped during the last bear market. This overrated rule is another excuse for the bulls to use to blame for staying bullish all the way down. This will change nothing especially with decimalization. I cannot believe how so many are rooting for this and think it really means something.
Mark to market? Who cares? Financial companies have been reporting their earnings any way they wanted to for years. It wasn’t until it became really bad did they fess up to the problems. I have news for those who want lesser standards of accounting… that’s what caused this problem in the first place.
The concerted effort by the governments and the banks to make things look better continues. Did you now notice Barclays joining CITI and BAC in saying the first two months of the year were better? It should now be obvious that this plan to instill confidence is just that…a team effort. Of course these supposed new profits do not include the losses and write downs because all the assets and write downs are to be moved. I wish I could do that.
The market…well, another decent percentage rally in short order.
It was I, in the last bear market that coined the phrase BEAR MARKET RALLIES ARE SHARP, QUICK, MAKE YOU FEEL GOOD, GET PEOPLE TALKING ABOUT THEM, SUCK YOU IN…. AND THEN BURY YOU SOON AFTER. Last week was sharp, quick, made people feel good, got people talking about them and sucked many people in. The question: will the market bury them soon after?
All I can do is go through the patterns that have not let me down…knowing things can change. All I can do is spot proper buy and sell points, proper short and cover points…and make sure of one thing… WHEN WRONG, NEVER LOSE BIG! It is just that theme that keeps us always in the game.
I have found it funny that after a 55-60% bear market, that so many are STILL calling lows… some actually calling the lows for the year. Maybe they are right…but you know what I think of those calls. Even Joe (the mouth) Biden chimed in this weekend saying the market rallied because of Obama. I am sure the “IN THE TANK” media will not question him as to whether the 25% drop since the new presidency was because of Obama.
The most important thing that occurred last week was the follow through day. It is an important characteristic that has always been present in new bull moves. Of course, while all bull moves have had one, not all follow through led to new bull moves. I believe 8 have failed in this bear market. But like all these days, I try to give them the benefit of the doubt. Why? Because I know that eventually, one of them will lead to a new bull. But it is not just about one day. We must continue to see better action in subsequent days, weeks and months. Better action is defined by higher volume up days, lower volume pullbacks. Better action is defined by leadership in which top stocks are breaking out of trading ranges. So far, we have seen a select few names but not much. As I scanned this weekend, I saw the usual. I saw the NFLX, MYGN. I saw some new names like HMSY, BEAT. I saw the AUTO PARTS names like ORLY, AZO. I saw what moved up. I saw the AMZN move up above a little resistance. So there are some things… but I am a big believer in the markets continuously proving themselves.
Shorter term, the market was already a little overbought going into Monday as put/calls were overly complacent…and again, seeing a bunch of low volume wedges into resistance/and or moving averages. Maybe all these wedges and low volume moves change this week… I am for all outcomes… whatever the market wants. I just want to see more. We have all seen many sharp rallies over the past 18 months that got everyone excited, everyone giddy, everyone jumpy. I need more proof. I see no reason why we can’t bounce further in the near term. I just think this will not be as easy to the upside as some think. Will keep fingers crossed. Monday’s action was less than thrilling as market did reverse on heavier volume. It is also less than thrilling that the market notched a distribution day so quickly after a follow through day. For now, by definition and by my rules, the market is in a confirmed rally… but give me more.
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