This market is nuts. We dropped 120 handles from 9/27 to 10/4, then rally back 160 handles off the lows in a little over a week. On Tuesday of this week it looked liked the market may have hit a short term top as more negative rhetoric emerged from Europe, The banks were dropping like a rock and they looked like they wanted to take out some short term support, then reversed and rallied..the market too.
Yesterday afternoon however topped the cake.
At around 3:10 PM yesterday there was “breaking news” that the world was saved and Europe had come to an agreement. The Guardian in London reported this:
Latest plans discussed by the Guardian include allowing the EFSF to offer first-loss guarantees for bondholders, be they private or public. Senior officials say this plan will lever the fund to €2T compared with the current €440B in funding. This would effectively make the EFSF an insurer, overcoming ECB resistance to the idea of turning into a bank.
This report was later denied by authorities, but not after the S&P rallied had rallied about 15 handles. After further research by me, The Guardian’s top story that day was “Elvis Seen on Mars With Space Hookers”.
Headline market. Ya think?
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