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The Bull Market May Not Be Over Yet

ByBB Finance Blog
Published 05/16/2012, 02:42 AM
Updated 07/09/2023, 06:31 AM
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The markets are standing on a precipice. One more push and they will be in free fall. Crude is near $93 and breaking that level will take us to $70.

Gold is at $1543 and on confirmed sell signal. Apple (AAPL) is back to its pre-earning level. The euro is at a new low. God, we have panic. I wrote almost a month ago when the air was full of talk of SPX 1500, mark my words, we will have panic soon.

As I wrote Monday night, I will wait to see SPX close below 1330 for two consecutive days before I decide to short again. Yesterday we came close but it was not enough. We will have to wait for another day. This is the beauty of the market. That it is able to turn sentiments in the opposite direction in a very short time. Now everyone is totally bearish and clarion call is going out to short the market with all the leverage. But it may be too early, too soon. Only time will tell.

Surprisingly, RFG, the Guggenheim S&P 400 Mid-Cap Pure Growth ETF did not show much damage. And all the bearishness did not put much water on the mother of all scams, the Facebook IPO. For some reason Groupon (GRPN) shares were in high demand yesterday and the stock jumped almost 4% on good profit. Don’t folks realize that it’s all accounting myth? I think most of the demand was for taking loan for shorting.

I am sticking to my plan. I am happy to be out of the market watching the psychotic behavior from low to high to low. We do not always have to be invested and cash is a position. When in doubt, stay in cash. I do not think we have seen the end of the bull yet. There is still some life left in it and it may surprise many.

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