subject: Markets Soar As Shorts Get Whipped Hard [print this page] Over the past few days, I wrote many articles discussing major levels hit by key stocks as well as far too much bearish sentiment in the market. Prior to a holiday weekend, I thought it was highly unlikely we would see a major break down and would even possibly see a rally. With a huge rally today, this turned out to be dead on. Understanding market psychology has become more and more important in these markets.
The SPDR S&P 500 ETF (NYSE:SPY) is soaring at the highs of the day higher by $3.03 to $108.34. This is truly a move for the ages off of the China PMI numbers ADP Employment data and the ISM economic data. China PMIand ADPEmployment data were not great but at this stage the market breathed a sigh of relief that they were not worse.Then, the ISMdata was posted at 10:00am ET and causes a major squeeze as it came in far better than expected.
The massive surge today can be due to a few different factors. Partly the good economic data from all over the world. The other portion is due to shorts getting caught with their pants down. As I mentioned in the opening paragraph, the average trader and investor, even the media and analysts were so bearish. I gave my opinion many times and my subscribers and bought long trades like the Financial Select Sector SPDR (ETF) (NYSE:XLF). Profits galore folks.
