market going up like things are booming... but USA in 'Death Spiral'

[denner]

Quote from Chuck E. Cheese:

The difference is pre QE/bailouts and post QE/bailouts event.

I can agree with that to an extent. Nonetheless, all the QE hoopla didn't stop the severe decline last year or the numerous short term corrections throughout the 2009-present.

Basically, Ben and his cohorts are more than willing to "prime the pump" and use their various mouthpieces to float QE rumors UNTIL gas prices/crude oil hit a certain upside limit. They are as politically bent as anybody else at this juncture.

 

[piezoe]

Quote from denner:

lol. Seriously, there are a bunch of knobs on this site who continue to argue for these "pre election rallies" as if they are a certainty. Two of the past three Presidential election years experienced intense sell-offs.

Not only was 2008 a bloodbath, but everyone seems to have forgotten the "dot.com" bust of 2000 as well.

It is more reliable when you have an incumbent running! 1996 counts! 2000 doesn't. 2004 counts! 2008 doesn't. 2012 counts!!! And of course 2008 has to be considered an exception in any case. (There was even a rally into the election in 2000 that got started late!)

We are in the pre-election rally phase right now!
We will almost certainly reach the April high, or higher, before election day. To reduce risk, unless you are already long, I would wait for a 50% retrace to enter long and then hold to late October. In 1996 we had a sideways consolidation of nearly two weeks after the pre-election rally got underway before we got our 50% retrace. After that it was smooth sailing.

 

[Ash1972]

It's just amazing how few people understand what "dead cat bounce" means, and that no government in history has ever been able to influence the direction of the stock market.

 

[nillionaire]

Quote from piezoe:

We are in the pre-election rally phase right now!
We will almost certainly reach the April high, or higher, before election day. To reduce risk, unless you are already long, I would wait for a 50% retrace to enter long and then hold to late October. In 1996 we had a sideways consolidation of nearly two weeks after the pre-election rally got underway before we got our 50% retrace. After that it was smooth sailing.

50% retrace of the move starting from where? 1266 at the beginning of June, or the 1330 low from 2 weeks ago?

 

[piezoe]

Quote from Tsing Tao:

Trust me, Obama can promise all the ice cream he wants, but at $4.50 a gallon, the hoi polloi as you call them, won't be listening to anything but their screaming wallets.

This is one of those rare instances were I find myself in agreement with zdreg. As if by magic, the market will go up into the election AND gas prices will come down. (but it won't be magic that's doing it.)

 

[piezoe]

Quote from nillionaire:

50% retrace of the move starting from where? 1266 at the beginning of June, or the 1330 low from 2 weeks ago?

It is very simple really. I would measure the retrace from the most recent highest high relative to the most recent lowest low. So for example our most recent lowest low in SPX was 1354.65, the most recent highest high was today at 1407.14. Retracing 50% of the difference would take the index down to 1380.90. So if the market were to drop to near 1380.90, you might consider entering long assuming you were looking to enter on a 50% retrace. That assumes we don't make a still higher high before that happens, in which case you have to refigure the 50% retrace point, from the most recent highest high, relative to the most recent lowest low.

Incidentally, we are aided in our entry decision by knowledge that the S&P is a mean reverting index. If you plot out the retrace moves in the index, you will find that it is quite common for the index to retrace 50% of the move from most recent lowest low to most recent highest high and then reverse.

 

[piezoe]

Quote from Ash1972:

It's just amazing how few people understand what "dead cat bounce" means, and that no government in history has ever been able to influence the direction of the stock market.

So you think that Fed monetary policy, inflation, and the decision to abandon Bretton Woods have had no effect on market direction, huh.

 

[BSAM]

Quote from Ash1972:

...no government in history has ever been able to influence the direction of the stock market.

EXSQUEEZE ME???

 

[Illum]

Quote from Ash1972:

Sorry, but what's this "pre election rally" everyone is talking about? You mean like 2008?

This

But no govt has influenced the markets?... Shiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiittt

 

[bonds]

Quote from Ash1972:

It's just amazing how few people understand what "dead cat bounce" means, and that no government in history has ever been able to influence the direction of the stock market.

Yup, they're gonna deadcat bounce this market right back to all time highs!!!