Bulls vs Bears

4/28/08

Since the opening of the market, bulls are trying to break above the resistance while bears are holding their belt tight not losing. For all major indexes, almost it is a flat day which indicate the balance of bulls and bears. S&P still cannot close above 1400 mark yet while it does trading higher intraday. Most likely, market is waiting to see how the Fed rating decision on Wednesday and we will have the important non-farm payroll, unemployment index announce on Friday.
Today, Morgan Stanley see big bank woes just beginning.."More capital hikes and dividend cuts are coming as our credit deteriorates and forward earnings decline" analysts led by betsy Graseck wrote in a report. "We think we are only in the third inning of the credit cycle and expect this credit cycle will be worse than the slump in 1990-01". Well, I mostly agree with the Morgan Stanley's analysis but I think it is going to be much worse since post-war period ( or even as same as the great depression time ). Do not let the market makers/traders to trick you with the recent rally, you would regret it later for sure to participate this fake rally. This upward motion of stock market would not last long soon and we will see the next phase of the market in coming weeks.