Melt Up ?

October 13, 2010 7:13am by Barry Ritholtz

Fed Minutes combined with a strong earnings report from Intel and CSX to propel futures higher this morning. US Indices closed marginally higher yesterday, reversing their negative opening after Asia was off 1.5-2%.

This market has had repeated opportunities to roll over, to fall on bad news, to follow other bourses lower, or to take a modest sell off of 0.50-0.75% and turn it into something more dangerous.

In just about every case, Mr. Market has refused to cooperate with the bears.

The bottom line remains: Excessive pessimism, under-invested Main St, a gradually improving economy, backwards looking sentiment, and a flood of liquidity continues to make it challenging to be short this market.

The Fed has made cash trash. Commodities, Tech, Ag, Precious Metals, Dividend yielders, Small Cap Tech, telecom are all sectors in play.

My questions: Does this rally end once the bears throw in the towel and cover? Will it run through the elections? Can it go to year’s end? And will we ever see carbon based volume return to the market, or are we all just trading with Skynet?

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