Monday, May 4, 2009

The Need for Money Will be Deeper

May is historically the second best Dow and S&P gain month, consistently since 1985. The Dow's gains last week is its 7th in 8 weeks, what looks to be a beginning of a bull rally.

We could see a sign up upside to lead the market , but the "holding up of the market" each day may falter this week.

But, the results of the bank stress test will be out this coming week, and more of the fraud will show, as the need for money will be deeper. There is also a lack of breadth in the bull run, with only 7 NYSE names making 52 week highs, while four hit new lows, showing exhaustion in the market.

If Citi is said to need up to 10 billion, remember the "good month" that raised the market earlier when the Citi CEO led the market with false optimism and projection. Study the Dow projections carefully, and let's continue an incredible winning run of 14 for 14 options profitable.

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