If you haven’t already, throw your name into the hat for a giveaway of:
Hedge Fund Operational Due Diligence (follow link and submit comment)
Tuesday’s rocket ride was attributed to a news trifecta:
Rep. Barney Frank, made public that the SEC is considering the reinstatement of the uptick rule. Bernanke’s mused on more flexible accounting for banks to allow them to replenish their capital base and to prevent them from limiting their lending in a downturn (as they are now). Finally, Pandit made wildly optimistic statements about the profitability of Citigroup (C), based on the first two months of the year.
Whatever the actual rationale, Tuesday, March 10th, was yet another Lowry 90%-90% days. Of course, if you’ve been paying attention, this is nothing new. In fact, if we just count the times that we’ve fallen to a 52 week high, only to zoom higher on a Lowry 90-90 up day, it would be the fourth time:
The last time was just a few weeks ago (February 25th) when I asked cynically, Does Yesterday’s 90-90 Lowry Up Day Change Anthing? If you’re unfamiliar with what a 90%-90% Lowry up day is, follow the previous link for an explanation.
Of course, this bear market has been remarkable for its lack of significant counter rallies. So it isn’t surprising that although there is a lot of chatter about a bear market rally, not a lot of people actually think it will materialize.
- June 1978 — 314 days
- January 1975 — 429 days
- September 1932 — 294 days
I continue to believe that we are in the vicinity of a major low but unless you have a long term view, that isn’t really useful. Also interesting, the percentage of S&P 500 constituents trading above their 50 day moving average closed at 5% - slightly higher than almost zero (0.4%) reached in October 2008.
If you look carefully, you’ll notice that back in the previous bear market bottom of 2002-2003, it acted similarly. However, the big difference between now and then is that the actual index itself was able to maintain itself at the same levels (more or less).
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