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After the bounce comes….comparison to 2011
The sell off was just a bump in the road then? With people suddenly experiencing more volatility, many investors are suddenly caught in the greed and panic mood yet again. The sharp sell off caught many by surprise, and while some have trimmed their longs, others still engage in chasing the market higher.
The Trader suggested yesterday that the sell off resembles last year’s action. With everybody having learnt over the past months, buy the dip, we are getting that perfect “panic” buy bounce. Now, let’s see who gets the upper hand here.
Chart comparison below.
SPX in 2012.
SPX in 2011.
and this is what happened after the bounce in 2011....
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If thrown down from a high point, dead animals usually bounce. Cats tend do do it better then others.
Except that there is an increase of tens of trillions of dollar denominated fiat currency to be fractionally reserved to leverage the ever inflation Fiat Ponzi and the CBs are using market securities to increase the leverage above the trillions of toxic debt they are holding.
No one left in 'the market' except Apple hoarding funds....so the markets will do whatever the bankers want them to do.
the gyrations are endemic of the cronyism of the period.
http://expose2.wordpress.com
Not to let facts get in the way of a good story/chart.....Let's put last year's price action in context. Mid late Fed - Libyan bombing. Early mid March selloff and bounce on the heels of wild newsflow following Japanese tsunami and nuclear meltdown.
While I wholeheartedly agree that the short term memory of the investing/trading public is laughable (robots don't know if they were long yesterday) and we are now preconditioned to buy the dip, which will work until it doesn't......the circumstances are different - perhaps no less foreboding, but different.
...another bounce. With everyone on the sidelines, the Fed and central bank trade bots will do what they want. Moreover, put up a chart of the short interest over the same time periods, I dare you.