Price discovery and resulting values are now made up of an ethereal composite designed to resist poor economic conditions while absorbing the benefits of an unprecedented top down liquidity drive whose success is ultimately measure by Dow Jones Industrial Average. Daily grinds of true economic darkness oddly help provide rapid turn around times for all things connected to the Fed/Treasury intervention.
After the October 2007 highs, the violent move down into the March 2009 lows consisted of liquidation, re balancing, and the unknown. Now however, price action reflects the market's readjustments to the Fed's constructive re-liquefying and the use of various financial supports as a part of this evolving organic intervention period. Part of it has to do with the very nature of stock market action. Some things are designed to trade, and others are designed to trade up. Stocks have always had an upside bias as a buy side vehicle without much hedge function, unlike commodities and fixed income markets. What else could account for the performances of such great money managers over the years. They are not traders, they are just longs and up works.
It is natural to have a downside ear to the ground given all the economic difficulties of the largest financial institutions. There is no end to scary in these economic times. But for investors, traders, no matter how bearish, if the Fed has its way, up is going through you.
