I just saw this note from Briefing.com (emphasis is mine):
14:41 Floor Talk
Despite the appearance of a solid upwards trajectory in the major indices today, institutional desks still caution that the lack of volume suggests that the big money has yet to start moving in. While concerns over the price of crude appear to be somewhat assauged (sic) after Venezuelan President Hugo Chavez won the recall initiative, traders are telling us that the key catalyst needed to get money off the sidelines and into the mkt would be a multi-day sell-off in the price of oil combined with a corresponding rally in the major averages. Hence, if the mkt can finally show the ability to sustain its moves higher, money managers may start to feel the need to move money into the market so they don’t miss out on any nascent rally. In particular, traders are watching the deeply oversold semi stocks as well as the brokers to lead any rally.
That reminded me of something that Todd Harrison used to always write in his column on RealMoney back in the day: “The buyers are higher.” That’s contrary to what you usually hear about ‘buying low and selling high’, but the note above shows how much truth is in that phrase. I know I’m in that camp. I’ll gladly miss trying to nail the bottom and just wait until new uptrends are in place to start buying.
Oh yeah, stop by and check out this week’s Carnival of the Capitalists.
