Best of the Week
Most Popular
1.The Greatest Stock Market Crash Of Your Life Is Just Ahead… – Warns Harry Dent - GoldCore
2.Budget 2016: Borrowing, Lifetime ISA, House Prices, Economy, Syria, Brexit and Stocks - Nadeem_Walayat
3.Gold Price Intermediate Top - Clive_Maund
4.Brussels Terror Attacks, Death of the European Union, BrExit Wake up Call - Nadeem_Walayat
5.Stock Market Maybe This Time is Different? - Tony_Caldaro
6.UK House Asking Prices Break Above £300k! Housing Market Paralysis - Nadeem_Walayat
7.A Big Reason Why Silver Price Is Set To Soar - Hubert_Moolman
8.The Financial Crisis Has Just Begun; Is The American Dream Is Over? - Chris_Vermeulen
9.Gold Stocks Spring Rally - Zeal_LLC
10.GLX, GLDX, Baby Gold Bull Market Stillborn? - Rambus_Chartology
Last 7 days
Central Banks Need a Higher Gold Price : Hello GATA - 3rd May 16
A Currency War Battle That Europe and Japan Can’t Afford To Lose - 3rd May 16
When the Truth is Found to be Lies, Confidence in Currency Dies - 2nd May 16
How Brexit Could Help All of Europe - 2nd May 16
US House Prices Outpacing Official Inflation Rate, Household Income - 2nd May 16
USD Still Declining... - 2nd May 16
Gold & Silver Rally Huge as Central Bankers & Analysts Flub - 2nd May 16
Stock Market Bounce Day - 2nd May 16
Stock Market Uncertainty Following Two-Month Long Rally - Will It Continue? - 2nd May 16
Stock Market Correction Underway "Upside Objective Reached" - 2nd May 16
USD, Yen and an ‘Inflation Trade’ Update - 2nd May 16
Gold Commitments of Traders and More - 1st May 16
The Magic of Gold Ratio Charts - 1st May 16
Consensus Forming: China Heading Back Into Financial Crisis - 30th Apr 16
The Next Technical Price Targets for Gold & Silver - 30th Apr 16
Stock Market Downtrend Should be Underway - 30th Apr 16
Gold And Silver – A Clarion Alarm Call For All Paper Assets - 30th Apr 16
US Economic Statistics LIES, LIES AND OMG, MORE LIES - 30th Apr 16
Stock Market Strong Elliott Wave Relationship is Developing - 29th Apr 16
Fed's Kaplan: Brexit to Factor in US June Interest Rate Decision - 29th Apr 16
Silver Miners Strong in Grim Q4 - 29th Apr 16
Is Silver a better bet than Gold in the Near Future? - 29th Apr 16
How to Use the CoT Report in Gold Investing? - 29th Apr 16
Sri Lanka is Intriguing: Areas to Consider for Value Investing - 29th Apr 16
Gold “Chart of The Decade” – Maths Suggest $10,000 Per Ounce Says Rickards - 29th Apr 16
Are We or Are We Not in a New Gold Bull Market? - 29th Apr 16
Silver: The “Five Year Plan” and the Great Leap Forward - 28th Apr 16
Michael Hudson: The Wall Street Economy Has Taken Over The Economy and Is Draining It! - 28th Apr 16
AUD/USD - Trend Reversal or Just a Bigger Pullback? - 28th Apr 16
A Gold Revaluation Could Transform Your Financial Status - Overnight - 28th Apr 16
Monetary Policies Misunderstood - 28th Apr 16
Gold Bullion vs Gold Miners - 28th Apr 16
OECD Suggests BrExit Would Cut Net Migration by 1.2 Million by 2030 - 28th Apr 16
MP Naz Shah Punished for Tweets Made During Israel's Genocide of Gaza Palestinian People - 28th Apr 16
Global Recession in 2016 and Beyond - The Obvious Evidence - 27th Apr 16
Why Gold Bugs Need to Stop Listening to The Fear Mongers and Start Thinking for a Change - 27th Apr 16
BlackRock’s Fink: Fed to Raise Interest Rates by Quarter Point ‘at Best’ - 27th Apr 16
Gold More Productive Than Cash?! - 27th Apr 16
Donald Trump Will Fire Janet Yellen and Be Trapped - 27th Apr 16
Money Saving Gardening by Propagating Roses From Cuttings - Propagating Rose Plants Over 2.5 Years - 27th Apr 16
Facebook Censors Pro Trump and Negative Hillary News - 27th Apr 16
This is the Era of the Democrats and Your Taxes are Going Up - 27th Apr 16
Long Awaited Gold Price Breakout - 26th Apr 16
Crude Oil Price Double Top or Further Rally? - 26th Apr 16
Madness in the Crimex Gold and Silver Trading Pits - 26th Apr 16
Britain's Prospects: GBP and BREXIT - MAP Wave Analysis - 26th Apr 16
CRB, Gold, Oil, Cotton, Coffee - 7 Must See Commodities Charts - 26th Apr 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Catching a Falling Financial Knife

Stock Market Hopeful of Fiscal Cliff Agreement.....

Stock-Markets / Stock Markets 2012 Jan 01, 2013 - 10:01 AM GMT

By: Jack_Steiman

Stock-Markets

The stock market has been hoping for an agreement between both sides for quite some time. It began to look quite dismal for the prospects of getting something done. Neither side really seemed interested in doing what was right for the public but isn't that always the case. They probably still don't truly care, but there is an image and reputations at stake here, so it appears a program of some real substance will get done, one that actually includes both sides giving in some. Seems almost impossible to believe, but there is real hope that things will get done and done in a way where the public actually thinks it's not half bad. Never say there aren't any miracles. You are possibly witnessing one at this moment in time. If we get exactly what we need we should see higher prices in the stock market overall. Not straight up. Lots of head fakes up and down but overall higher. Let's see what we get over the next 24 hours and how the market responds to it.


The market opened on Monday a bit lower, but quickly gathered a head of steam as news came out that things were progressing along. Once Obama spoke at 1:30 PM ET, the market blasted off once again. He wasn't exactly super optimistic while saying that things were moving along but that no deal had yet been struck by the two sides. At first the market started pulling back, but shortly thereafter, it started gaining steam and by the time the day ended, there was nothing, but green across the board, closing right at the highs. Very solid action as the market is sensing a good agreement both sides can feel good about. Solid action that shows the market isn't dead and gone just because we have struggled for the past week or so. The bulls can feel good about today's action. Nothing to get excited about, but clearly good action for the bulls.

Let's take a moment to go over things regarding the overall health of the market. You need to ask yourself a few questions. Also, you need to look at the backdrop regarding interest rates. First of all, at this time we see no distribution volume off tops. That's key. Big money is not selling off high readings. Good news is still treated as good news, and sentiment is not even close to being a problem. In addition, there may be something more importantly to realize.

Mr. Bernanke is intentionally keeping interest rates near zero so as to keep people from running out of the market. With rates this low folks have nowhere else to go with their dollars. This alone is helping to protect the stock market from falling apart. Even if rates started to go up from here it would be a very slow and gradual process. Rates would still be too low for folks to start running out of equities and into the safety of those rates. Until rates start going up much more than where they are now, folks will likely stay with stocks over anything else. The market may not always be friendly with the news that's out there, but Fed Bernanke is working on forcing folks to hang in there. He's doing a good job from that perspective.

The market will likely continue the whipsaw that's been occurring and making life difficult for traders, but I think we can still have some small exposure, just nothing too heavy. Buying oversold is best but not the only way. I would not be shorting until we get a sell signal in the overall bigger-picture market. That doesn't exist in this moment. It can happen quickly and suddenly, but right now the market remains on a buy signal which really exists until we see sub 1350 on the S&P 500 or the long-term up-trend line.

Peace and Happy New Year!

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Sign up for a Free 15-Day Trial to SwingTradeOnline.com!

© 2012 SwingTradeOnline.com

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.


© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife