After a mighty run to the upside Friday stocks took a dive on lower volume.  This market is full of large percentage moves in either direction and can only be described as whipsaw action.  There are a few positive signs in the market; we have some leadership showing, New Highs are starting to beat New Lows, and volume is now appearing more often on the upside.  What is concerning and should be taken into consideration is the V-shape move stocks have made in the month of March.  It should be noted that V-shaped moves often are seen as failures because they lack the ability to consolidate the gains.  If you did not participate in the move, don’t worry if there are still more gains to be had you haven’t missed too much.

Is it over yet?  The bear market may or may not be over, but what we do know is the government has injected a tremendous amount of new liquidity into the market.  This new found liquidity will find its way into the highest yielding asset class.  Stocks are seen, like gold/silver as a hedge against inflation and with the new liquidity we are bound to see inflated prices in the future.

This market needs to prove itself, I will be patient and waiting to see if it happens!

Market Speculator

Last 5 posts by Market Speculator

• Quality Growth Stocks Lead the Way as Stocks Advance in Mixed Trade - June 2nd, 2009
• Re-Inflating the Bubble; Inflationary Pressue Lifting Stocks - June 1st, 2009
• Treasuries Begin Their Decline Striking Fear into the Stock Market - May 28th, 2009
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• Sipping on a Cup of Coffee Deciphering Whether or Not The Stock Market is About to Make a Leg Down - May 11th, 2009