After the JP Morgan earnings report, stocks tumbled on concerns that banks might have more losses in the future. This seems like it was the first down day in some time, as the market as just continued to climb higher and higher. For me, with a market reaching new highs, my excitement level doesn’t increase with the market; rather, my nervousness increases with the market. As the market moves higher, and the real economy continues to struggle, I wonder how hard the fall back to reality might be in the coming days.
I believe that as the market moves higher or at least stays at current, high levels, we will see more and more bigger down days. Most people buying stocks at current levels are traders, in my opinion. These traders are buying with one foot out the door. So, if a move lower materializes, look out as everybody heads for the exits at the same time.
Only time will tell.
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