We spoke to a few trader friends of ours early today who told us that today would be the ultimate sucker’s rally.
In their view, the good economic news would drive the markets up, creating selling opportunities for anyone who had built up long positions during the long rally since March.
A few weeks ago, lots of traders and investors were hesitant to get out of the market too early. Many got into the rally late and were afraid of getting out too early. Having missed a lot of the upside on the first leg up, they didn’t want to miss the tail end upside.
No one we spoke to feels that way today. In fact, the folks who told us today would be the ultimate sucker’s rally said they think we’re headed right back down next week.
That said, this could be a huge contrary indicator. After all, this kind of pervasive negative sentiment is exactly the sort of thing that creates buying opportunities.
We’re just simple reporters telling you what people are saying at trading desks. We just had the strongest one day rally in months. Do you think it will keep up? Would you stay long going into the weekend?