Market is on a roll

• Posted by vinaydh
• on January 10th, 2010

There is nothing to dislike about this market from the long side. This market is on a roll. The next upside objective is 1167. I think we may see a quick profit taking bout after that but that would provide an excellent opportunity to get long again.

The jobs report on Friday was a little disappointment but we are in the stage where little disappointments are more welcome than very positive surprises. Anything that would spur the fed into rate increase mode would rattle the market. I do not think it’s going to happen anytime soon.

We have crossed the denial stage and are now in the acceptance stage of this rally. More and more folks have started to accept this rally now. Many trend following folks should jump into the market now on any continued strength. This stage will eventually give way to the euphoric stage. So there is more than enough room for this market to rally further.

In short I would stay long until around 1167 and then look to get back on any pullback. If no pullback materializes than jump aboard targeting 1230. In fact long term investors should just stay long rather than try to be time these little wiggles; or better a portion of the portfolio should remain long at all times until a sell signal of some significance is generated.

It seems Meredith Whitney has become the latest casualty of this rally. She downgraded GS this week and the marker or GS didn’t even took notice of that. Every market stage creates new heroes but they rarely are the same as in the last stage. The reason is the inertia in the human thought process as the market moves on.

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