The MoneyMan Report Announces New Market Research

Daniel Frishberg Shares New Market Research on The MoneyMan Report.
  • (1888PressRelease) April 01, 2011 - Dan Frishberg began the show Monday by discussing what he sees below the surface in his daily Market X-Ray. He said that although stock investors must be enjoying the rise in prices right now, it is mostly surface-level growth. When you really examine the activity, you find there is underlying weakness below, which is much more consistent with snapping back with a painful selling episode than seeing the next leg up in the bull market.

    Still, Dan sees no change in the overall path of the stock market. "There has never been a bear market that started with so much demand and supply at a low. You can count on the fact that we are still in a bull market. We will still make newer, higher levels."

    Dan noted that when you think about it, the market is in a better position than the media would have people believe. "We had an emotional selling episode combined with a huge amount of news that was reported as though the world were coming to an end," said Dan. "But the S&P 500 decline was right around 6% - a dip that any moderate pullback could cause. We're only 3% down from the highs and we consider it a correction."

    A month ago, buyers were compelled by an intense desire to own individual stocks. That irresistable urge was there at the August low as well, and in November. "That thrill just isn't there right now. My Market X-Ray indicates that this is much more consistent with a bounce back."

    It is not necessary to be pinpoint-accurate to make money in the stock market, although sometimes it is possible to guess roughly when a pullback will occur. For this one, Dan sees a selloff somewhere between Tuesday the 29th and Thursday the 31st. "That's when I believe the sellers will overcome the buyers," said Dan, framing it as an opportunity. "If we go down another 3 or 4%, we could get another chance to have a real buying episode. Or, of course, we could have another weak false start that doesn't go all the way up."

    In summary, Dan believes that there are two distinct possibilities. Either the rally continues and buying intensifies, or we run out of gas this week and take another trip down to the bottom, possibly even under the lows. "If that happens, we will get enough fear to create some real bargains."

    So what should investors do now? "It would be a great idea to wait and be patient right now," said Dan. "You could see volume and demand will go up and advancers becoming stronger vs. decliners. If we see that happening, you know I was wrong and I'll be the happiest guy in the world."

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