A quick note on today’s stock market action. The market opened gap down, as expected, on all of the overseas selling of the last two days, but the low of the day came at the open. It was mostly up from there, with a nice surge on strong volume in the last half hour of trading. We had several recent market leaders post gains in the 2-3% range: AAPL, GMCR, NFLX, AMZN, LULU.
I wouldn’t be calling a screaming buy just yet, because there is still too much uncertainty and the banks are in real trouble, but it’s more evidence that the unreserved bearish commentary we are seeing is overdone. As I have been writing in my weekly articles, we’re in a new trading range and could break out in either direction. I still think it’s just as possible that the market is building a base for a new rally, as it is that we will see a collapse.
We don’t tell the market what is should be doing, we let the market tell us what it wants to do, and position accordingly.