Banks on the Brink

Tuesday, February 10, 2009, 3:43 PM
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Tuesday, February 10, 2009

The impact, and probable purpose, of this buying is to drive up the price of stocks and to ‘rescue' the market from a technical failure that would have ensued by a breach of the November lows.

A belief I hold, formed from watching this same pattern play out dozens of times, is that such upthrusts in the price of stocks do not reflect a change in their underlying fundamental prospects, but rather are mere technical affairs driven by a few interested parties, who have the ability, and the deep pockets, to horsewhip prices off of key technical points.

But that is merely my belief, as I have nothing to go on besides having watched the futures premium (for the S&P 500 contracts) perform some very odd and very bold departures from the cash market at key moments.


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