2008 Aug 06 - Wed
Market Notes for August 6, 2008
This article really isn't about today. Nor is it about yesterday. It is about Monday.
But becuase I only read Mark Hulbert's colummn today, which he penned yesterday, which is
about Monday's 332 point gain, I've dated my article for today.
Mark's point of the day revolves around another rule of thumb: the day was not a 9-to-1
up day. This type of day is when 90% of the volume of shares that rose or fell in price was
in shares that went up. The term was coined by Martin Zweig, who used to publish several
investment newsletters. On Monday, for the NYSE, it was only an 8.1-to-1 day.
According to his 1986 book called "Winning on Wall Street", Zweig states "Every bull
market in history, and many good intermediate advances, [has] been launched with a buying stampede
that included one or more 9-to-1 up days".
In Mark's article of yesterday, he mentions that valuations are still a little high. As
such, a bull market may not be in the offing yet. So far July 15 is considered our low of
the current bear market.
I think because of additional mortgage resets happening later this year, we may not be
completely ready for bullish thinking. Maybe a nice little volatile rally, but we may see
some more lows.
|
