I think my skepticism of the week before last about the stock market action being the rinse cycle in a wash and rinse has a little more street credibility, given the U-turn that equities made right on key support levels.
I grow old, I grow old, I will ladder Treasuries and have them rolled.
I hear Alibaba's IPO, which will be the largest IPO ever and a real bell ringer, will be coming out on September 16th, with the road show starting in Asia on September 3rd. Unless something really happens, it will surprise me very much if stocks are going to take a dive during that time period.
As a reminder this Friday is a stock option expiry. The next stock option expiry will be on September 20th.
Stocks are jammed up into short term overhead resistance right now from a down sloping trend channel also known as a bull flag. IF they can move higher from here they have a good chance to run higher to the top of the intermediate trend before Friday expiry and take out the bear option players.
Then we might get another test downwards, but the cynical me says that the Street will try to smooth the way for the mother of all IPOs in September, at least until the 20th or so. Unless Alibaba snubs one of the big Wall Street machers in the underwrite and ability to dole out the spoils and take their vig. Then all bets are off.
Have a pleasant evening.