Monday, August 06, 2012

European Vacation Market Thoughts

$$ - The stock market had another up day, although late-day selling is something new, right? The stock market is up at the top of the summer's trading range, if one believes in the Sell in May stuff and that it is working this year. It's nothing unusual to see the market move sideways and for folks to be bearish at the bottom of the range, and bullish at the top of the range. But whenever it's at the highs or lows, it can be a little unsettling if you're leaning the other way. So now, if you're mostly in cash and low beta stuff, it doesn't feel good to see the market back near the highs.

Meanwhile, there doesn't appear to be a negative catalyst out there. The last we heard from Europe, was that Super Mario Draghi was going to save the Euro. Then they all went on vacation for the month. Er, okay. US earnings continue to be up and down, neither hot or cold, but consistent with the mediocre economic readings we get on a weekly and monthly basis.

So, what to do?

I'm not doing anything. Still the same. Low beta stuff and cash. I don't think the correction is over. But I did miss the ride back up the sideways trading range. Drat. I believe we're heading back down, but who knows if the market will get below 1300 again. We still have the bulk of August, September, and October ahead of us.


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