The “Basketball Effect” …

Major rallye today … why?

I call it the “Basketball Effect”

If you put a basketball under water and let it go … it pops exactly into your face …

Market was under severe pressure over the last month, dropping around 20(!!!)% …

Now … shortly before March future expire/rolled over … a bounce was SURE!

Everybody always wants to find a trigger, especially the talking heads on TV.

Today they got SOME …

- Citi’s CEO said, that his company had 2(!) profitable months in a row and the best quarter since the last profitable one

- Bernanke said, mark-to-market will stay, but might be “tweaked a bit”

- Senator Frank said, the uptick-rule might be introduced again

So … sellers stepped back, shorts covered … markets squeezed between 6 and 8%

Let’s see, how far this bounce takes us.

BIG PROBLEM … this time, the “bottom” had no PANIC at all involved … VIX did not spike … so

believe it or not … COMPLACENCY is still KING …

Be aware!

Tags: Bernanke, Citibank, mark-to-market, outlook, uptick rule

This entry was posted on Mittwoch, März 11th, 2009 at 00:30 and is filed under FDAX. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.