Ed Note: The above is a small excerpt from Mark Leibovit’s Daily VR Trader. The VR Gold Letter is published WEEKLY. This excerpt from 8/24/09.
The stock market did it again. Despite a weak start, the bulls kept the buying pressure on all session long and it resulted in another up day for the market. For the session, the Dow was up 56.61 at 9683.41, the S&P 500 was up 3.29 at 1052.63, and the Nasdaq Composite was up 10.86 at 2102.64. Volume increased over Monday and breadth was positive.
The question for traders is whether exiting profitable long trades here makes sense in view of several upcoming cyclical and religious events which could possibly negatively impact the market. I emphasize possibly.
The conventional wisdom calling for a market rout in September/October could well be vindicated, but when? After the Dow Industials sees 10,300. One month from now around the notorious third week of October? Or, possibly after October into the end of the year – a scenario that turns everyone upside down?
So long as the market tracks in a steady ‘up channel’, volume is positive and fear rules, we may continue to climb that ‘Wall of Worry’ a bit longer. Inevitably we’re going to see a correction. Whether it’s a rout or crash, I cannot say. Sure, if the Dow Industrials pushes its way to 10,300, what prevents the market correcting a 1000 to 1500 points afterwards? The answer is nothing!
With Rosh Hashanah, Options Expiration, the Autumnal Equinox and Yom Kippur all ahead, part of me wishes to go to cash and simply stand aside. I haven’t pulled the trigger, but the finger is there ready to pull.
The truth is that the market has been rallying and correcting in a fairly orderly manner and there is nothing to fear but fear itself. I don’t think the market is simply going to turn on a dime and head south, barring some super-dramatic geo-political or ‘cosmic’ event. We should get some warning and should broad-based Negative Volume Reversals ™ materialize, then we have something to latch on to.
Yesterday was a potential ‘Turnaround Tuesday’, but the bears had little resolve and the bulls were never really threatened. Yes the indices pushed into the red early on, but once again selling pressure was very weak, and the bulls soon took control, engineering a steady move higher for the remainder of the session. Fed Chairman Bernanke declaring the recession over provided yesterday’s catalyst to bring more buyers into the market.
Longer term, I remain worried. You and I both know that the good sales and manufacturing numbers we’ve been getting have been boosted by the cash for clunkers program. But what will happen in September and going forward? All these people who were looking to buy cars in the near future, have now done so. Auto sales will likely fall off a cliff now and the economic number may look weak as a result.
Marks VRTrader Silver Newletter covers Stock, TSE Stocks, Bonds, Gold, Base Metals, Uranium, Oil and the US Dollar.
More kudos – Mark Leibovit was named the #1 Intermediate Market Timer for the 10 year period ending in 2007; the #1 Intermediate Market Timer for the 3 year period ending in 2007; the #1 Intermediate Market Timer for the 8 year period ending in 2007; and the #8 Intermediate Market Timer for the 5 year period ending in 2007. NO OTHER ANALYST SURVEYED APPEARED IN ALL FOUR CATEGORIES FOR INTERMEDIATE MARKET TIMING AS PUBLISHED IN TIMER DIGEST JANUARY 28, 2008!
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Marks VRTrader Silver Newletter covers Stock, TSE Stocks, Bonds, Gold, Base Metals, Uranium, Oil and the US Dollar.
More kudos – Mark Leibovit was named the #1 Intermediate Market Timer for the 10 year period ending in 2007; the #1 Intermediate Market Timer for the 3 year period ending in 2007; the #1 Intermediate Market Timer for the 8 year period ending in 2007; and the #8 Intermediate Market Timer for the 5 year period ending in 2007. NO OTHER ANALYST SURVEYED APPEARED IN ALL FOUR CATEGORIES FOR INTERMEDIATE MARKET TIMING AS PUBLISHED IN TIMER DIGEST JANUARY 28, 2008!
For a trial Subscription of The VR Silver Newsletter covering Stocks, Bonds, Gold, US Dollar, Oil CLICK HERE