As regular readers know, I'm counting on a countertrend top between 1050 and 1200 on the S&P, and we're within spitting distance of it. Today's high was barely 1% underneath 1050. I maintain my belief that this is nothing more than a countertrend rally unless (God forbid) we were to cross above 1200.
The folks over at Elliott Wave provided a very interesting graph on sentiment today:
Not to put too fine a point on it (.…..say I'm the only bee in your bonnet…….), investors are now even more doe-eyed optimistic about the prospects for equities than they were when the S&P peaked at 1576! All this crap about tons of cash on the sidelines and people waiting to pile into the market is just that: a load of crap. They're already in! And they're expecting things to keep soaring! (Just like, ummm, in October 2007).
The "cash on the sidelines" thing drives me nuts. The "cash" was destroyed in the 58% decline – remember? The notion that people:
- Sold at the top
- Tucked their "cash" away somewhere really, really safe
- Now have all that cash at-the-ready to buy stocks
is….…that's right!….……..utter crap.
It's lovely that today was a good day for me, but I've been through the past five months and know it doesn't mean squat. You know the last time we had a good, solid down week? June! So it pays to take it one day at a time and assume Goldman is just playing games with us all until things start to seriously, seriously crack.
And, I assure you, ladies and gentleman, that is a day to which I eagerly look forward.