Astounding — but the markets (most of them) have decided that most of the bad news is out of the bag (cat, which is occasionally seen bouncing, whether alive or not.) The market also doesn’t seem to be worried about the election. It is perfectly at home with the idea of an Obama presidency. Well, it couldn’t be any worse than what we’ve had — in fact maybe one of the reasons for positive market mood is the prospect of the end of Bush and the era of spend and not tax. Spend and borrow. Worry not for tomorrow. We repeat our political mantra: We’re not Democrats and we’re not Republicans. We’re against whoever is in power. Astoundingly only Bill Clinton has showed any fiscal savvy in our time.
We remain cynical and skeptical of this little uptrend. But that doesn’t mean we won’t trade it long. The Dow has taken out the horizontal lines around 12800 and is near to taking out the overhead lines. While we don’t know if that will happen we know that we should be putting a few toes long.
The Qs show more of a turnaround bottom than the Dow. Fundamentally thinking (economic fundamentals –everyone knows what we think of market fundamental analysis) we believe that technology is and will be our salvation. Now if only Sergi can figure out a way to erase the debt with technology.
Once again we don’t know what will happen but there is a clear buy signal in the gold.
As we have said every trade is an experiment which may or may not work, but the experiment must be made. The stop is 4% under the May low.
Suspicious activity in the dollar. Soros said the other day that the markets always overshoot. The dollar has just been overshot. It has been executed in cold blood by the feckless economic policies of the present (mal)administration. We do believe that when the dollar turns it will eat euros for lunch. And — for the moment we would maintain a trading posture on the long side — like that cat on a hot tin roof.How did that cat get in here anyway?