It's the believe it or not stock market rally. Just as pundits and analysts begin to forecast hundreds of bank failures in the coming years and lament the abysmal state of our financial system, the market decides to frustrate the maximum number of participants with a bear crunching rally.
It might not seem like it, but its already been an impressive rally.
From its intraday low yesterday, the Dow is up 508 points or 4.7%, the Nasdaq is up 117 points or 5.4%, the S&P is up 45 points or 3.75%.
How about some individual stocks?
From Monday's intraday low, Washington Mutural (WM) is up 1.50 or 49.5%.
From yesterday's intraday low, Wachovia (WB) is up 2.74 or 35%.
From Friday's intraday low, Freddie Mac (FRE) is up 2.94 or 75.5%.
Where do we go from here?
Call me crazy, but I think the direction is higher. There were some intraday reversals on panicky selling in some of the stocks mentioned above. Earnings season has started with Wells Fargo (WFC) setting an upbeat tone. Other financial company announcements likely will not be as rosy, but I think the results will be met with relief rallies anyway.
It's going to be a nail biting few weeks as shorts and longs alike decide whether its really time to pull the trigger. Keep your ammo ready.
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