Funny things happen on the way to new highs. Risk is on, there's a spring in your step, all fear has left the building and everything you buy goes straight up. You've entered through the gates of Pandora and walk through the sweet fields of ambrosia. These reasons alone are why you should be wicked cautious up here in the nose bleed seats. But putting that aside for a minute, these are some things that will certainly happen as they always do in a viciously bulled up tape.
1- The most common are takeover rumors. They happen with goods solid stocks, but beware of the rumors on garbage stocks. They are started by trapped longs that want out. You will lose EVERY time other than for a scalp.
2- Another one that became fashionable, and was all the rage a while back, was the old " XYZ cancelled an appearance at a conference". This one is a beaut, as if it would imply an imminent takeout of the company that cancelled.
3- You will hear that "private equity" is looking at everything. No they're not. Don't ever forget that "EVERY company by its public nature is a takeover target, so take all of these nonsensical events with a grain of salt. The takeover that ends up on your P&L will be pure luck and a pleasant surprise. I do think this will be a great season for takeouts though, and that generally is good for the market as it has a tendency to lift all boats.
When risk is on, as it now, everything plays and is in play. $AAPL can rip on a special dividend that never comes and biotech stocks can rip on an FDA approval that may never happen. This is risk on.
We're about thirteen handles from an all time intraday high on the $SPX and the livin' is easy. Bernanke and the Fed reported on what the banks could do with all your money after the close, and most of it was good, so expect stock buybacks and dividends starting tomorrow from the finnies.
Oh, and don't get goofy up here. We're short term long in the tooth.