From the investorplace.com
Market’s Summer Romance May Come to a Swift End
It's hard to say when and where it will come from, but risk happens fast
Jul 26, 2013, 2:25 am EDT | By Serge Berger, Head Trader & Strategist, The Steady Trader
Serge Berger is the head trader and investment strategist for The Steady Trader. Sign up for his free Weekly Market Outlook Video here.
“The summer wind, came blowing in — from across the sea
It lingered there, so warm and fair — to walk with me
All summer long, we sang a song — and strolled on golden sand
Two sweethearts, and the summer wind”
– “Summer Wind,” Frank Sinatra
Earlier in the week I wrote a piece for a vastly European audience referencing the above song by the great Frank Sinatra. My point was that I thought the song captured investors’ current summer romance with the stock market.
The news flow “across the sea,” back and forth between the U.S. and Europe, played a game of equilibrium to keep the stock market afloat. One day it’s good earnings reports from a large U.S. conglomerate, the next day improving economic data out of Europe layers another bid under the market.
The song culminates with an abrupt end to the romance. As for the markets, I can’t help but liken this latest summer rally to a game of musical chairs. When and where the catalyst for a mean-reversion move to the downside in stocks arrives, no one knows. What we do know is that when the music stops, those that chased stocks higher simply because they were mandated to do so will likely bleed the most, while those with more patient attitudes will get better entry levels to buy stocks. Patience, as they say, is a virtue.
Read more >>
Market’s Summer Romance May Come to a Swift End
It's hard to say when and where it will come from, but risk happens fast
Jul 26, 2013, 2:25 am EDT | By Serge Berger, Head Trader & Strategist, The Steady Trader
Serge Berger is the head trader and investment strategist for The Steady Trader. Sign up for his free Weekly Market Outlook Video here.
“The summer wind, came blowing in — from across the sea
It lingered there, so warm and fair — to walk with me
All summer long, we sang a song — and strolled on golden sand
Two sweethearts, and the summer wind”
– “Summer Wind,” Frank Sinatra
Earlier in the week I wrote a piece for a vastly European audience referencing the above song by the great Frank Sinatra. My point was that I thought the song captured investors’ current summer romance with the stock market.
The news flow “across the sea,” back and forth between the U.S. and Europe, played a game of equilibrium to keep the stock market afloat. One day it’s good earnings reports from a large U.S. conglomerate, the next day improving economic data out of Europe layers another bid under the market.
The song culminates with an abrupt end to the romance. As for the markets, I can’t help but liken this latest summer rally to a game of musical chairs. When and where the catalyst for a mean-reversion move to the downside in stocks arrives, no one knows. What we do know is that when the music stops, those that chased stocks higher simply because they were mandated to do so will likely bleed the most, while those with more patient attitudes will get better entry levels to buy stocks. Patience, as they say, is a virtue.
Read more >>
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