Investor sentiment remains strongly bullish but a little less so than a week ago. The fear index (VXO) remains very low. Trading volume was anemic through last week’s very limited downturn. The only significant price movement was that the S&P 500 Index closed below 1400. The index opened less than 1% down Tuesday and again on Thursday. Each down day the business news reacted like the sky was falling.
As with many previous weeks, it was again “financials” (zombies) that set the tone. Not surprisingly, BAC rose Monday and Friday and opened down Tuesday and Thursday just as the S&P 500 Index did.
Bubbles pop. Perhaps a blatant QE3 (as the news alludes to today) will provide the final fuel, some “crisis” will hit, or the market will just finally succumb under it’s own weight. Just as with the calm before the storm, we watch and wait…
