Thanks Bill. I respectfully disagree. Big players, whether they be financial institutions, wealthy private individuals or trading houses, make up a majority of the trading every day and control the direction of the market. Buy programs send the DOW hurtling +100 points or -400.
On another note, I see the recent rally as speculative only. I will paint a picture of what I saw last week. After last Thursday's close, things were looking bleak. Then Intel forecast sales (not earnings) that were higher than the previous quarter. They may be stuffing the channel, recording sales earlier, whatever. The market seemed to take in stride that the semi-conductor industry was going to roar back. I saw it as a desolate market grasping for whatever news it could to make the case for a higher opening on Friday. It happened. Clinton helped a bit, it appears, as well.
The other speculation that has kept this recent upswing on track is the rumbling that Greenspan will lower rates when previous history on AG's actions do not point to this at all, at least for the rest of this year. The IMF bailing out SA is also a point of contention but it is doubtful that the funds needed for the supposed bail-out will be easily forthcoming.
Finally, the market has sought to personalize the bear/bull runs with Clinton and AG. When it looked bad for Clinton, the market tanked. When it seemd that he would not be impeached, the market recovered.
AG obviously controls the short term direction of this market and dictates the sentiment on the Street. Ignoring technical indicators, I very much see this as a market that is running on speculation only.
If AG douses the high expectations of the market with no positive spin today, we break down. If he gives the bulls fodder for another rally, we break 8500.
It all hinges on AG since he controls the direction for the short term. |
