For us, the big question going into the weekend was whether or not the most recent leg higher in U.S. Stocks is the beginning of something bigger, a breakout of epic proportions, or just a major whipsaw that will lead to further selling into September and October, two of the most historically volatile months of the year.
We see various crowds. On one hand, you have the bearish cult who for many reasons have fought this uptrend the whole time. Whether they just missed the last couple of years in stocks or, worse in some cases, missed the entire decade, they’ve been very wrong. There’s even a group who wishes harm on the United States and elsewhere around the world, just because they disagree with decisions being made in D.C. They certainly don’t want stocks to rise. And then you have another group, who is indifferent and is just looking for a favorable risk vs reward shorting opportunity and they think this is finally it. [Read more…]