Tuesday May 5, 2009
How much better could things be, especially in such a short time? This chart show the percent of S & P stocks in bullish formation on their point and figure charts. Mind you , it does not mean they have returned to the price levels of last summer, but the at least uptrends are in place. The higher lows have resulted in overbought RSI and MACD. Wow could things be better? As we have shown however, long term interest rates continue up, the 30 year bond is now over 4%. The US dollar continues to weaken giving gold and silver a boost. Oil has nudged to the mid 50s, a huge improvement over the sub 40 klevel just months ago.
Against this picture of massive improved sentiment, the FED, contrary to banking laws, will release the result of the Stress Test on banks, while assuring us no one will fail. That will happen after the market closes this thursday afternoon. While we cannot tie a futre fundamental event to a specific outcome, it appears the stock market has done all it can do for the time being.
Frankly we would rather have detail on where and how much Federal money has gone and to who, now that would be transparency. We suspect Thursday afternoon's news will be more to peddle additional influence over the banks, ala GM and Chrysler.
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