It used to be that Zweig's admonishment "don't fight the feds", was a cardinal rule to obey. The fed's easing from January 2001 and on, proved that theory to no longer hold, at least in a don market. I think that the reason was that the market already anticipated the fed's future move well in advance. It is clear that th next Fed move will be to raise the rates, but historically, such rate hikes (ar least the first two) did not have a major negative impact on the market. Yet, if we look at the BPFINA, clearly the financial stocks are already in a small bear market of their own. Is it possible that the recent market decline has "over discounted" the coming fed cut, and when it actually comes (or the Feds actually signal it ill indeed come), the market will look at such as evidence that growth in the economy is intact for at least few more quarters, and thus in corporate pricing power, and thus corporate profits, have not yet reached the point of "how much better can it be? These kind of considerations were behind the general map of last December, but these considerations are also in the FA category, and we must obey the TA, which is becoming a little shaky....
I think watching the BPFINA (continued deterioration or a small counter trend move?) together with the behavior of the leadership (BTK?) and the SOX (breach of 460 a major concern, but not yet the "death sentence) in the next week or two will shed some light on the evolving scenario.
And while I was typing this the second serving of AMGN went here at $57.80, just $.73.
