Wow, what can you say about this market as it continues to bounce up near the flat line after an early first hour sell off. As many of our loyal readers know by now we will rarely experience a sharp decline on a Friday ahead of the weekend. This usually occurs for a couple of reasons.
The first reason for a flat Friday is so that the Asian markets don’t get spooked or panicked over the weekend. Remember the Asian market will open up for trading on Sunday night. America needs China worst than China needs America right now.
The second reason is so that the person that worked all week will usually spend money on the weekend when he or she has a day off. The powers that be need the public to spend if this inflation rally that has been orchestrated is going to have a chance to work and cause an economic recovery. Therefore, they don’t want you to turn on the news and see the Dow Jones Industrial Average down over 100 points. That would keep the person that is going to go out and spend money to reconsider and perhaps save his cash. Please remember that consumer spending accounts for 70 percent of the GDP in the United States.
These are the reasons why the stock market is rarely down sharply on a Friday. If you look at a chart you will notice that in the past two years we have had very few strong down trading sessions on a Friday and today is really no different.
