Less than 17 ticks from 11,000 is the high print from Thursday. Today, Good Friday, the futures market was open for a 1/2 day, but cash markets were closed. Today’s unemployment figures showed an increase of 162K non-farm payroll. This was only the third time since 2007 that we have had an increase in this number. Today’s was the largest increase of the 3.
Time to break out the party hats? Unemployment holds at 9.7%. Monday will be the first real test to see if funds come back and start buying. Spring break is over, perhaps the fund managers will be back from Aspen/Snowmass from their Spring ski breaks, and will collectively sigh and re-enter the market.
Most of them most likely missed a great part of the the almost 5000 point rally which began with the March 2009 exhaustion lows.
Is now the time they flip the switch and re-own shares? Only time will tell.
The S&P cash, printed a high on Thursday at 1,181. Can the S&P rally less than 20 handles and get the 1200 print? Considering the March 09 low was at 666 (the Omen number) perhaps we will have to have a print at 1332 for that to be a doubling. Certainly that’s not out of the realm of possibilities, However, first things first, we have to get through the 1200 resistance.
Again, I have been cautiously bullish for the last 5 months, mostly because we have been just climbing a wall of worry and pessimism like never before.
The last time I personally saw anything like this was in 1987-88, when I graduated from Colgate and was warned by all of my recently graduated friends in NYC, not to come and get a series 7, because “the business was over”. Typical with bottoms, they are bottoms because people get overly pessimistic.
I would continue to be wary of a reasonable correction to test the nerve of ‘long term investors’ once again.
One caveat would be the fact that a lot of market soothsayers and experts have been looking for a correction over the past year. It has not materialized. My guess is that it will jump up and bite everyone the moment Time or Newsweek prints a cover story recommending stocks for the long term. Massive public opinion/sentiment is reflected in such publications. That’s why their ‘big ideas’ or big proclamations are 99 percent of the times profitable fades.
Enjoy your holiday weekend.
