Swine Flu vs Over-optimistic market

The market had been generally positive for the past 7th weeks. Though it may seemed that the market is overbought, the RSI and the Stochastics are showing that the market managed to let off the "steam". It seem that the general public are afraid of losing out in the market, entering at the time when the market is supposed to correct itself. Each time the market dropped, it only ended negative for one or two days before closing higher the following days.

Last night (SG time), news of swine flu pandemic in Mexico gave me the gitters as it reminded me of the SARS crisis in Asia a few years back. Today, we have confirmation that the swine flu had reached U.S., Europe and other countries. The Asian markets generally closed lower today. One can expect the European markets to also end lower today. The U.S. market is already showing negative during the pre-market session.

The big question is, will the U.S. market just drop for one or two days, or will it represent the continuation of the bigger downtrend. More bad news needed to be released over the next few days before the market is convinced that they need to continue with the major downtrend.

When Asia had its SARS crisis, the Asian economies were in tatters. The swine flu could be worse than SARS and it now occured when the world economies are slowing down / already in recession, etc. If things are really bad, we can expect the U.S. market to break the March lows. The great losers could be the airlines as travelling would be greatly affected. Viral vaccines manufacturers such as Roche would be one of the greatest winners. When Singapore was hit with SARS, the sales transactions in NTUC Fairprice increased significantly as many families bought more groceries to eat at home instead of eating out. The same consumer behaviour pattern could repeat itself in U.S. and elsewhere.

Cheers !

PersianCat (Millionaire-in-progress)

Jon Stewart Bashes CNBC and Rick Santelli

I always thought that most of CNBC newscasters/hosts are a bunch of *$@^*~ (I am advised not to call people names. Good advice though). This video I supposed sum it all:

http://www.dailymotion.com/video/x8lou7_jon-stewart-bashes-cnbc-and-rick-sa_news

Cheers !

PersianCat (Millionaire-in-progress)

Reminder - Jewish Passover & Good Friday

The Jewish Passover falls on April 9-11 and April 15-16. During these few days, no work is permitted. Expect the volume of all trading instruments to be low. More info on the Jewish holidays could be found thro the link:
http://persiancat04.blogspot.com/2009/02/jewish-holidays-in-2009.html

Tommorow is Good Friday holiday. U.S. stock market is closed.

Cheers !

PersianCat (Millionaire-in-progress)