{"id":43272,"date":"2013-10-22T12:30:21","date_gmt":"2013-10-22T16:30:21","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=43272"},"modified":"2013-10-22T11:13:44","modified_gmt":"2013-10-22T15:13:44","slug":"stock-market-reached-peak-optimism","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/10\/22\/stock-market-reached-peak-optimism\/","title":{"rendered":"Has The Stock Market Reached Peak Optimism?"},"content":{"rendered":"

By Michael Lombardi, MBA<\/a><\/p>\n

\"Micahel<\/a>Optimism towards key stock indices<\/a> is increasing each day. The U.S. stock market \u201cseems\u201d to be a safe place, and it\u2019s common to hear stock advisors suggesting we are going higher on key stock indices.<\/p>\n

Key stock indices like the S&P 500 are making fresh highs. Google Inc. (NASDAQ\/GOOG) has surged above the $1,000-per-share mark. Just take a look at the chart below.<\/p>\n

Recently, we heard the \u201cGodfather of Charts,\u201d Ralph Acampora, turn bullish on the key stock indices as well. Not too long ago, he held a very bearish view on them. In August, his stance was that key stock indices like the Dow Jones Industrial Average<\/a> would decline 20% to 12,000. (Source: Wall Street Journal, October 17, 2013.)<\/p>\n

Hold on a second! This all looks too familiar!\"\"<\/p>\n

Chart courtesy of www.StockCharts.com<\/p>\n

Whatever happened to what Sir John Templeton said about the bull run stock markets? If I remember correctly, it went something like this: \u201cThey are born when investors are most pessimistic, rise when they are skeptical, mature once optimism builds up, and come crashing down once there\u2019s euphoria.\u201d<\/p>\n

It\u2019s almost as if investors have forgotten everything that we saw with the stock market in 2007 and 2008\u2014how it went crashing down after optimism surged.<\/p>\n

And remember 1999? Investors were so bullish on the key stock indices that they were investing in companies that did not have any revenues or weren\u2019t going to make money in the long run. After that euphoria, we saw it all come crashing down. Investors forgot one basic principle: when stocks keep reaching new highs; fundamentals really matter when it comes to the stock market.<\/p>\n

Have we reached peak optimism on the key stock indices on the current rally?<\/p>\n

One of the major factors behind the bear market rally we have seen since 2009 was easy money. It\u2019s still around. I can potentially see key stock indices going a little higher, as the punch bowl is still on the table and I hear the new Fed chairman wants to keep the easy money policies in place as well.<\/p>\n

In the short term, key stock indices are showing robust price rises, and that\u2019s what the bear dressed as a bull does best. Unfortunately, take away easy money, and there is not much for stocks to celebrate. That\u2019s why I don\u2019t buy into this stock market rally.<\/p>\n

This article Has The Stock Market Reached Peak Optimism?<\/a> was originally published at Profit Confidential<\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By Michael Lombardi, MBA Optimism towards key stock indices is increasing each day. The U.S. stock market \u201cseems\u201d to be a safe place, and it\u2019s common to hear stock advisors suggesting we are going higher on key stock indices. Key stock indices like the S&P 500 are making fresh highs. Google Inc. (NASDAQ\/GOOG) has surged … <\/p>\n

Continue reading “Has The Stock Market Reached Peak Optimism?”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-43272","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/43272","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=43272"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/43272\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=43272"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=43272"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=43272"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}