What is happening to the market now is a 10% correction.
The rally has started. This should break the January highs of 10700 and test 11500 before a major correction to 10700 again.
The market is recovering as evident from the many economic indicators. Unemployment indicator is always a laggard. The manufacturing indicators are showing major positives.
Empire state index, Philly index, Richmond index, Michigan index are all showing positive growth in the manufacturing industry. Consumer confidence is a lagging indicator as well. And it should improve significantly next month as predicted by the manufacturing indexes.
The Fed is getting ready to increase the interest rate, so this is the last chance for a quick bull rally. After that, it will be a slow bull run or should we say a cow run.
The market has tanked heavily since January, and it has regained its footing recently until China blew it up. However, China cannot really stop their growth just by their tightening policies, they are going to grow really fast. 10% GDP growth again.
Tomorrow, we will see the housing sales which is expected to be positive. Bernanke testimonies will be watched by Wall Street.
All bull runs always begin with a sudden drop, followed by a series of long green candle.
Once the bull starts running, it won’t stop. A bull run is in the making here. Witness it.
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