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IBDvalueinvestin (99.58)

Get Ready for 6 Week Summer Rally it Started last week.

Recs

7

June 22, 2010 – Comments (5)

The Stock market fell -15% from recent highs. Thats a normal correction after a major stock market rebound that we had for 13 months. The correction though has left many stocks now cheap ahead of earnings in July. Companies have started giving guidance ahead of earnings and CAT already has given good guidance this morning.

The Euro and Greek problems will be mostly out of focus now as majority of politicians will be leaving on summer break soon. The Euro problems will rise again in mid to late August again when the austerity measures of Greece will be judged, if they are judged as not satisfactory then a Greek default will be the outcome at the end of August.

 

The Chinese currency being unpegged is great news because it means the market will judge which way the currency goes and the market today says its down -1/4%  against USA dollar, so much for the Bears hopes yesterday that it would rise dramatically against the US Dollar.

 

Let the Summer Rally Begin.

5 Comments – Post Your Own

#1) On June 22, 2010 at 9:51 AM, drgroup (68.37) wrote:

Greece, Spain, Portugal, England, Germany are either bankrupt or one step removed. The US is printing useless paper. Unemployment is hoovering around 10%. Obama is always inches away from enacting a law designed to extort more of your hard earned money. Terrorist are knocking at our door with no resistance from the white house regime. I fail to see the reason for a summer rally. This world is filled with to much obvious uncertainty for wishful thinking about a market rally that last more than ten minutes.... 

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#2) On June 22, 2010 at 10:14 AM, MoneyWorksforMe (< 20) wrote:

Bulls will tell you they're being contrarian. However I believe a double dip is in the cards and that is the closest you can get to contrarian right now. Most are convinced of this being a "normal" correction.

The global economy is slowing down--it is plainly obvious--- and earnings expectations are WAY up. If expectations were way down I could see your case for a short term rally. But I don't see how earnings can possibly be as good as they were last quarter. Expect A LOT more misses this summer--perhaps not terrible, but definitely not as good as we just saw in Q1. If that happens, the bearish case will become virtually conclusive. Recent news from Nokia, Best Buy, and Smart Balance was also rather ominous...

 

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#3) On June 22, 2010 at 10:48 AM, Dow3000 (< 20) wrote:

IBD, you are way behind the curve.  You could have bought dips b/w 1932 and now...but it is a sure way towards losing your shirt now.  Dow 5000 before the year is over, be careful out there.

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#4) On June 22, 2010 at 11:01 AM, obsoleteaccount (73.76) wrote:

I don't know why bears think the world is just going to basically end.  I am not bullish but Dow 5000 I highly doubt. The market corrects, and then goes back up.  Thats what happens

"The four most dangerous words in investing are 'This time it's different." - Sir John Templeton

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#5) On June 22, 2010 at 11:04 AM, IBDvalueinvestin (99.58) wrote:

your name says Dow3000 , that is pretty way off the curve Dr. Doom.

 When people add names like Dow3000 or Dow20000 you know they are extremes of the norm.

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