surveying all the charts, news,
only one conclusion. Equities are ready to go again. Market assumes current price has factored in a recession for 2 Qtrs (dec 2007, jan 2008). market expecting economy to rebound in 2Qtr 2008. hence it would rise, however how far it goes is the question. Bush cheques would be released in May 2008, supposing to boost economy in 2nd Qtr.
if it cannot get back above the bull trend, then we are looking at a continous recession lasting 1-2 yrs.
hence market has priced in a 50bp cut next week, and a GDP of 1% or slightly better. The surprises would be a hawkish FED with a 25bp cut, and a negative GDP.
The other risk is Gold races into its terminus and completes its journey in double short time.
In general, it means continued USD weakness, Gold strength for the next month.
At least dun be fried shorting stocks in the next few weeks.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment