A final spurt in buying pushed mahor averagees to new highs for the year. The S&P surpassed the prvious weekly closing high level of 1068, closing at 1071.49. Televison commentators were giggy with delight watching every final closing adjustment as markets set new highs.
Still looks pretty toppy to me but I wouldn't be surprised if the market continued rallying some into next week's option expiration day. I for one had expected a fallback in October but purchased Put options out to next year. Those who had been playing for an October fall using October expiration options may be headed for total loss. I can remember many times though seeing the start of major market moves the DAY AFTER my options expired. Can you ever buy enough time?
Well, my days of crying WOLF are over. Twice now I have blasted e mails out warning of a top and it appears that twice my signals are falling through. There is probably too much money out there still looking for a home for any market fallback any time soon. Just today, a major brokerage firm called another stock to go $100 higher! Brings me back to the late 1990s when absurd price targets were floated out there by the investment banks and the stock immediately soared to those levels. I suppose we are just at the beginning of irrational exuberance. Even Alan Greenspan was so early with his Bearish call. The market went considerably higher after his call but long gone are the days where markets reflect reality.
What is the reality? If the markets start falling again, will the government again step in and add even more liquidity? They say that only 40% of the stimulus money has been used. If this could cause a 400 point runup in the S&P, imagine what could happen if all of the money was deployed. NEW HIGHS????