We might be at the foot of this next rally of 2010. The first rally started January and ended about mid January.
We have heard lots of bears calling a market top starting early December, however, the market kept climbing and climbing. Then finally these bears’ words came true when the Dow was at 10700.
20 days of selling sent the Dow spiraling downwards to 9800. And now we are back to 10150. This shows that the general trend is still bullish.
We had that Dubai, now Greek, what else? Anymore?
Remember Dubai? Market plunge, then it rose higher?
Similarly, Greece, we will go higher than that.
Why the bull?
Economic data: Awesome.
GDP --- Good
Unemployment rate --- Good
Unemployment claims --- Good
Credit default --- excuse me Marc Faber, you sure USA, UK will default its debt? Try harder.
Credit Cost --- Good (see Goldman report)
Home prices --- Increasing. Good.
Plans: Great
Interest rate increase --- end of the year. Expected
Obama job bill --- Awesome
China tightening policy --- bad… but no matter how they tighten, their growth just keeps escalating.
Greece help --- unclear, but should be like Dubai and Spain
What to expect:
Uncertainty --- getting lesser
Unemployment --- jobs are going to be added soon
Recovery --- slow but still faster than expected
Sectors that should gain the most:
Base metals
Financials
Industrials
Retails
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