Time to face the music.
On Sunday of this week i decided that it’d be fun to make a prediction. In my view it was going to be impossible to sustain the current rally in the US markets. Too much news was obviously negative, and all the attempts to put positive spins on it were getting out of control.
As usual my ability to relate to peoples desire to believe that things are always on the up and up, was my undoing. As far i can tell there is very little reason to optimistic given the fundamentals. No point in going over it all again. I’ll just say that it’s hard to see anything out there in the news that indicates much more than a world economy approaching terminal velocity. That’d be great news if we were talking about an ant falling out of a tree, but it’s not so hot with the full weight of capitalism there to drive us into the ground.
Interesting aside: what on earth is going on with the trading volume spiking at the end of each day? It appears that a lot of parties are closing / taking positions at the end of each day. Perhaps it’s related to trading systems trying to match outstanding orders before the market closes. Should look into it, must be explained somewhere… yes, people closing up positions.
Well, enough of that for a while. No idea what the market will do next week… but i maintain my opinion that we’ve seen the end of this (suckers) rally.