Since the S&P 500 made an intraday low of 1,536 on April 18, the widely-followed stock index has tacked on 130 points and the markets have migrated back to full-bore risk-on mode.
Before taking even one step further, I’ll tell you right up front that this is more of a “for fun” discussion than not. For many a moon I have followed a number of sentiment surveys that I believe can be quite helpful.
The elusive bottom in Chinese stocks is becoming more constructive here with a higher low being put in, above the 200-day moving average. MACD signaled a buy in May and is moving into positive trend territory on the daily chart.
Both the Dow and S&P 500 were off slightly after the great run higher over the past few weeks. Things were quiet for much of the day. There was an attempt at a rally mid-day that failed to hold and the large averages sold off fractionally.
Investors have increased their appetite for risk as the market continues to climb to new highs. There was a tremendous amount of fear in April that growth was not going to be sufficient to maintain such lofty levels on the major averages. Economic data was beginning to surprise to the downside and many felt that a long awaited pullback was just around the corner.
CNBC had to be feeling good about itself last week. Not only did it have the pleasure of highlighting some dubious business practices employed by its competitor Bloomberg, it also had the good fortune of conducting the interview heard around the capital markets world last Tuesday.
Stocks may not do much in today’s session given the almost empty economic calendar, but the bias will likely remain to the upside.
Tepper stokes the melt-up. “I am definitely bullish. The budget deficit is shrinking massively. Guys who are short, they better have a shovel to get out of the grave.” Hedge fund manager David Tepper, CNBC, May 14, 2013
How will Russian President Putin's efforts to squeeze the nuclear energy sector affect the uranium market?
Based on both recent history and mainstream economic theory the past few years should not have been possible. When you cut interest rates to near-zero, run deficits of 10% of GDP and buy up every government bond in sight with newly created currency, you get a boom, end of story. That’s just the way capitalism works.
Sponsored
