Where Will The Market Debacle Stop: Update

Fridays trade had all the earmarks of a bottom. At the beginning of the day I felt strongly that the bottom would be seen that day. However the trade on Friday felt engineered. It had all the technical aspects one would look for; heavy volume, started strongly down, wild volatility, spike in the vix to the mid-70s, and a sharp contratrend rally near the end of the day. I spoke with someone this weekend who claims that the head risk taker at Goldman is a buddy of his and he indicated that this person (I do not know if the person with whom I spoke really does know the head risk taker at Goldman, who the head risk taker is at Goldman or whether Goldman uses terms like head risk taker) thought the government came into the stock market in size. Whatever the case, it appears this Monday morning that markets are headed higher so let us hope that whatever the reason for friday’s technical opus, things will in fact improve from here.

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