This market manages to generate drama without really going anywhere!
The economy could still tank, stocks are still way overvalued, and inflation waits at the gate if interest rates are cut further; the dollar is overvalued, the trade deficit is too high. On the other hand, there is still the conviction that this is a temporary downturn, stocks could take off any day in anticipation of a strong third and fourth quarter, the dollar is strong and inflation low; the high-tech industry is not about to run out of innovations.
I don't see any resolution to this tension -- if everyone is waiting for a crash just to get a better entry point, that's a reason for it not to happen. As long as the future remains so uncertain, we should be trading in a limited range, though the current bleak outlook is surely more likely to pull us slowly downwards -- no capitulation, no finality, just bouncing as we slide....
BTW Larry, I appreciate your posts and charts. It's a given that nobody can predict the Nasdaq consistently; let's just have the modest ambition to have some fun, trade the channels, and not get whiplashed.
Kailash |
