Bullish news

In the 72 hours after a Group of Seven conference call on Aug. 7, the Federal Reserve pledged to keep interest rates near zero through at least mid-2013, the European Central Bank intervened in bond markets and the Bank of England indicated it’s ready to add more stimulus if needed. Japan signaled renewed concern about the yen and Switzerland yesterday stepped up its fight to curb an “overvalued” franc. (Source: Bloomberg)

In other news.

More executives at Standard & Poor’s 500 Index companies are buying their stock than any time since the depths of the credit crisis after valuations plunged 25 percent below their five-decade average. (Source: Bloomberg)

Central banks want the market to go up. Enough is enough they said.And insiders believed them and they started buying aggressively.

High volatility, on the other hand, reflects nervous investors. They do not know what to do. Buying aggressively. Selling aggressively.

High volatility, followed by lower volatility, more often than not suggests a bottom.

Let's hope so. Stocks lost close to 17% of their value since May and we need to recover some of the losses.

By the way. It looks like this year "Sell in May and go away" worked again. Something to remember. I always remind my readers of this unfavorable period in The Peter Dag Portfolio.

European stocks jumped, as the benchmark Stoxx Europe 600 Index rebounded from its lowest level in more than two years and is up more than 1%. U.S. futures rallied, while Asian shares retreated.

George Dagnino, PhD
Editor, The Peter Dag Portfolio. Since 1977
2009 Market Timer of the Year by Timer Digest

To find out more about my in depth views of the markets and my strategy just visit our website https://www.peterdag.com/ where you can subscribe to The Peter Dag Portfolio. You can also call me at 1-800-833-2782 to discuss your specific investment portfolio.

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