As the 12 month chart below reveals, there have been several strong moves off of oversold conditions. Other than the oversold bounce post Katrina, the chatter around each upwards move has involved the expectation that the Fed is (almost) done.
S&P500 12 months, Fed Theory
Source: Ritholtz Research
What happens as the market comes to realize the Fed may not be so close to finishing?
Stay tuned . . .
Quote of the Day
“Ignorance is not knowing something; Stupidity is not admitting your ignorance.”