As I said when closing yesterday, we are expecting rain here in Central California. It is sorely needed and it appears, the prognosticators will be correct, 100% correct. The grey skies outside my window look threatening, indeed.
Two weeks ago, the market looked threatened, you know with the emerging market meltdown and the collapse of the Chinese economy.
- World shares struggled to stay above water on Wednesday as concerns over opaque policy moves in China kept investors on edge amid a scarcity of major economic data.
Certainly, the Asian markets are still feeling a pinch from all that hoopla, but the US market is doing just fine, even if it is working hard to stay up.
- Tuesday’s modest pullback doesn’t make things more bearish than they were on Monday. It just makes it clear that the market is going to have to do some work here to stay in bullish mode.
Yes, the bulls will have to find more evidence to support the near-term climbing. Maybe, they will rely on the earnings that have been coming in to support the upward momentum. It appears that earnings, once again, are coming in at or above historical averages, and some of the key ones are actually stellar.
- Lowe’s reported strong sales growth in the fourth quarter.
Lowes is making a run at the king, Home Depot, no doubt about it, but the company can only do that if its target market is buying. How buys from Lowes? Certainly, do-it-yourself home bodies are one customer, but so are those who buy new homes, you know, for the wall hangers, the carpet, and the new shower doors they just do not like.
- Purchases of new U.S. homes unexpectedly climbed in January to the highest level in more than five years, showing underlying strength in the industry even in the midst of unusually harsh weather.
My point is keep on truckin’ in this market. It is ripe for traders and for long-term investors. Buy on the dip, sell on the rip, or don’t, just hold on for the ride. Either way, ignore the pessimists and stay optimistic. Oh! Maybe you should consider staying away from the Bitcoins, though.
- Mt. Gox, at one time the biggest bitcoin exchange, abruptly stopped trading this week amid reports on the internet that more than 744,000 bitcoins – worth around $380 million at prevailing rates – had been stolen.
Nancy and I (my lovely, talented, and beautiful wife – are you reading this my dear?) have been asking and answering a lot of questions about the Bitcoins, since it has been in the news as of late. Here is the bottom line, said so succinctly by David Moenning.
- When all is said and done, bitcoins aren’t actually a “thing”. They’re a premise.
Stay with the tangible. The other stuff is just speculation.
- Investor’s Intelligence reports that Bullish Sentiment rose during the past week to 53.5% from 46.5% (41.8% two weeks ago, 55.9% three weeks ago).
It appears the bulls are preparing to work even harder to keep the market going forward. I like that, and I like the VIX, languishing around in the 14-15 range. In fact, I like it all, which is a long way from where I felt last week.
Oh! One more thing. I rode BofA up and down for several years, but when it hit $16 a while back and it still had not put its litigation problems behind it, I jumped ship. It might be worth another ride here soon enough, if it can finally get that nonsense behind it.
- Bank of America has added $1B to its estimate of its potential litigation liabilities, bringing the total to $6.1B vs. a year-ago estimate of $3.1B.
Trade in the day; Invest in your life …
