I believe that we are still in a long-term bear market. Short-term; retail investors, institutional big boys and money managers in general have taken the market up on short covering, "bargain hunting" and the fact that they have to put cash to work to mimic their respective indexes (for those managers following the indexes).
To answer your question, based on tech signals and the global economic status, we are more inclined to go down from these current levels - specially when you factor in the supply and demand equation.
Just keep in mind that even from the lows of March 09, we did not go up in a single straight line - we also had down days. So going down, we will also have up days that will basically fool some folks...
We will continue to get data that will show a little light at the end of the tunnel; however, the end of the tunnel is very far at this point.
PS. Unemployment cannot continue to go higher with the markets also going higher - these two cannot run in the same direction (it is that simple).
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Unemployment is a lagging indicator whose correlation to the immediatte market is unapparent.
Agree 100% - unemployment is a lagging indicator. However, even as a lagging indicator, it cannot run in opposite direction with the market, neither can its revisions...
Hope you're not confused with my "opposite direction" remark - meaning, the market is going up (positive) and unemployment is also going up (but that is a negative)... Just wanted to clarify.
Just wanted to highlight what this lagging indicator (unemployment) can do to our major indexes... See the market today? Like I said before, unemployment cannot continue to go up and major indexes stay green... Why? That is the big question and the simple answer is that everything starts with folks been employed - the consumer... Wall Street wants to complicate this game and this is very simple!
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