The long awaited October jobs report just came out and was much better than expected. The August and September reports were also adjusted to reflect a much stronger employment picture for those months. (With all the revisions I wonder if we should even trust the recent reports at all.) So it looks like the bears may have to give up the argument that the job market is sucking wind. Rest assured that some of the bears will be capitulating on this news. The question is what will the bulls who are already in do. There’s already talk of higher interest rates coming down the pike, so at some point we may get selling over concerns about rates. In the very short term I think the bears are in (more) trouble. But I’m still looking to lighten my load of stocks ASAP.
Why not hang tight till, say, the QQQs fall back to their moving average? They’ve bounced from there every time since the rally began. There needs to be some kinda selloff here to generate buying interest … news has been wonderful since the gnp numbers but the market’s been flat. Tells me it’s read to turn over, especially when you combine that with the fact that we’ve had no major dips since mid-August.
I assume you’re talking about the 50 day MA. That’s way too much of a dip for me to withstand. I’m a short term trader, trying to catch 3 to 7 day moves. I’d rather get out, let the market dip, then jump back in. Longer term players should do exactly what you suggest.
Major dip is relative. The mid-late Setemeber dip would have been painful for short term traders, depending on where they got in. As would the mid-October dip.
I find myself under invested on the long side during recent market action, and I don’t think I’m alone. I’m forming a new theory (as always), that we see some weakness next week ahead of options week. So I may look to add then. And, I don’t think I’m alone.
Mmm. Dairy Queen cherry dip cone is my favorite!
For longer-term traders/investors any imminent dips on interest rate concerns is probably buyable. The standard playbook has not been working this cycle. Those who immediately bought stocks as the Fed began cutting rates are only now getting back to even. I believe the same this time around. Interest rates are so low now that it will take a drastic hike up to really cause concern. (Also note that after the 1990-91 recession, the Fed took another 3 years before they began raising rates again and job growth steadily improved that entire time). Ultimately, we should be watching what is happening with money supply adn the demand for credit. The money supply does not necesarily move with interest rates and credit does not necessarily follow in line either, although they should. And on THAT tip, I have seen rising controversy as to whether current contractions in various money measures really signify a tightening already underway – a “stealth” tightening by the Fed (we should note that the Fed was actually expanding money supply back when they raised rates as the bubble popped).
I don’t know why stocks would be weak ahead of this particular options expiration. November is traditionally a strong month, so I would assume people playing the cycles/seasons would be seeking to hold on at least until closer to Thanksgiving. Bears who keep betting on a market top also have loaded up on puts and shorts. So, there should be a decent cushion through this period. Just my few pennies of thought.