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She threw 16 billion dollars into the market. They had been draining funds from the system for three weeks to get the balance sheet back to neutral. Now the balance sheet is expanding again, contrary to the Fed's claims.
Well, like some racehorses I used to bet on, the index stumbled to that 2014 finish line today. Nevertheless, it posted a very solid 11.39% advance on the year.
According to marketwatch.com, it has gained a beautiful 64% over the last three years.
Don't see nearly enough compelling reasons to ease off the accelerator now. I think we're riding a secular bull ... and we'll get another nice reward for taking that risk next year.
Of course, looking further out, if those 2016 voters go full-on stupid and let another bumbling, incompetent republican administration take over the White House, then all bets may be off...
Last two days of the 2015 the major indexes declined. Check the NYSE High-Low range chart below:
As you may notice from the chart above, there are not a lot of changes in stocks traded close to their 52-weeks lows - the main bearish action was among strongest stocks on the market. Just 4 trading sessions ago we had 443 stocks traded in 5%-range from their 52-week highs and on the last trading session the number of these stocks dropped to 169.
let's check last two correction.
See NYSE High-Low Range chart at the end of September 2014 - before diving into the last strong correction - the major movements were among the weakest stocks on the market - 316 stocks were traded in the 5% range from their 52-week lows on September 30 of 2014 versus only 61 stocks on September 1 of 2014.
See NYSE High-Low Range chart at the beginning of December 2014 - before diving into the last minor correction - the same picture - 365 stocks were traded in the 5% range from their 52-week lows on December 8 of 2014 versus only 117 stocks on November 26 of 2014.
Now we have something different - S&P 500, DJI and Nasdaq 100 were pushing down while the Russell 2000 was behind. The questions now are
1. will bearish sentiment in strong stocks will go into January of 2015?
2. will weak stocks become affected by bearish sentiment in strong stocks?
If answer on these two questions is yes, then we are following into a correction which will be stronger that the one seen in October 2014.
As an update, the S&P 500 is currently at 2055 as of yesterday's close. That is about 1.6% below its 2090 peak reached on 12/29/14 and also below the 2075 peak on 12/5.
In other words, the stock market has been doing a whole lot of "nothing" for the last couple of months. And that isn't necessarily a bad thing, since the market needs time to rest and recharge every once in a while.
Happily, the fundamentals are looking good right now - the economy is improving, jobs are increasing, unemployment is down, consumer confidence is up, corporate profits are high... All of this bodes well for the coming months, so let's keep our fingers crossed and get this race horse going again.
Everyone chooses their date and calls the market a "race horse" and talks about how well it is doing...
The date they choose is the low, of course. That's how the "Bull Market" case is made.
But what if they choose Nov, '07? We could use that as a starting point just as easily, couldn't we?
In Nov, '07 the Dow was at 14,100.
Now, it's at 17,800.
That's a 26% increase. In 8 years.
Bull?
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