June 17, 2012
Weekly Market Outlook
By Keith Schneider
This picture is the perfect metaphor for the market at the moment. First, one can view the ducks sitting up front as the bulls leading the current rally, few in numbers while bracing for a headwind. Meanwhile, the flock could be looking back, staring at old news (Greeks bearing drachma’s) while missing the move to new highs. Or maybe, the driver (central banker) is just taking everyone for a ride.
Most players are in cash up to their eyeballs as no one can be sure of the outcome as yet another round of elections in Greece will be held this weekend. We have received emails from brokers scaring customers into cash by asking them to pony up more margin or face potential liquidation in anticipation of a big gap on Monday. Interest rates are at historic lows here in the US as the flight to perceived quality continues.
In the face of mostly bad economic news, capital requirements for banks that were set to be more stringent (Basal III Accord) and slated to go into effect in 2013 are being abandoned. This gives banks more time to throw good money after bad and juggle their balance sheets.
In the face of this, the US Equity markets are acting quite well climbing a wall of worry. Market Internals are starting to run rich and we are exhibiting a classic chart pattern, which we will review in this week’s video.
Also, be sure to subscribe to our YouTube channel here and get all of our free videos as soon as they’re released!
Every week you'll gain actionable insight with:
