Thursday, July 31, 2008

All In or Pile Out?

There is a good chance tomorrow's close will indicate direction for the balance of the trading year. Any long term bear trend the bears may have hoped for rests on tomorrow's unemployment numbers. Awash in bale-outs and Fed interventions, the markets are sloshing around with enough cash to fix immediate problems, but raising cash may be easier than restoring confidence in an economy where consumers are finding all sources less willing to oil the big green lending machine. Should trade reaction interpret future job growth to be resilient, the all in bell will ring. On the other hand, no one likes rejection, but the bulls may find that piling on is an art form when price action turns ugly.