Is the Rally Over?

" Joining me now for their insights Richard's Meyers the chief market strategist for value engine that condom queen mother Vera the president. Other brokerage firm will go Vera Lee and company and and you for the president of cheaper. I think management morning guys good to see you in -- you're on remote. You tell me eat. And you're down there do you believe this has been a bear market rally or is this the beginning of -- recovery."

" Well we've had a wonderful. Nine week bear market rally. That ended on Friday. After a gain of nearly 40%. And there you stole my thunder was all the reasons why -- could. But they don't have those that you and I agree on this. And I think the the way we get out of this is getting leadership right now it's been that it possibly going to be healthcare or public utilities believe it and not. Very defensive."

" Okay at you know it's interesting Doreen you're on -- is being used CD order flow and and and Richard mentioned health care. And utilities what concerns me and what could be the next leg up is that technology has really. Led the way and a lot of people in addition the financial institutions a lot of people suggest that technology is going to be anything to lead a Saturday. Utilities safe investment always do grow wealth tied to -- to -- treasury note. But our -- cool that leadership are you seeing the beginnings of what looks like the park relation of the new investment strategy while one and one of the."

" Problems that I haven't seen as the volumes on everything across the board I think the lions are. Much lighter than I would I would like to see them being if I thought there was any sort of real confirmation to -- I'm also in the camp that this was not. A bear market rally so I think that we're all in agreement they are not much diversity of opinion. I'm I think if you look at him fairly classic coming of bear market rally happened very quickly which this has. It's begins to sort of rollover and twenty to 30%. Higher I think we will exceeded our right around in that range. I'm so I think that this is kind of a classic classic move I think that the volumes were. Were heavier and and we saw some real leadership I would say that there was chance I was wrong but I think that. They were not seeing and I don't think I think it has been working."

" Again you look back at your technician you look a lot at what we've seen we talk a lot about what happened in the depression where we -- substantial bear market rallies and you also buy into the fact that it's a bear market rally but technically what are you looking at when most concerned about well."

" In this rally it is typical rally but the something strange happened during the last jittery weeks to -- probably concur on this and there was there was a power underneath the market that kept holding it up in treating the futures I watched the futures every day every tick. And tremendous amount of volume came in at several points during the last few weeks. When the market was just about ready to break and shot right up again. And I'll give you really twenty minute back tours usually put their they have -- would we took off Friday at 7 minutes to 4 o'clock. Almost a 100000. S&P futures contracts retreated. And then the last five minutes up to 4 o'clock another 100000. Contracts were traded at a contact and lifted the Dow from being down eighteen to up -- it's forty or fifty points. In seven minutes. That context is probably ten to twenty billion dollars to be able to move the market in such a way. Who has that kind of money to move this market. On top of that. The market has rallied up during the stress test uncertainty. And then did move the bank stocks up. And the bank stocks issued secondaries they issued stock they raise capital into this rally I think it was a perfect text -- set up. Of controlling. The markets now that the stock has been issued."

" I get in here a little bit on the fundamental side of things yeah yes we -- going -- Yeah probably have a sector evaluations at value -- in dot com. And back go on March the sixth we had every eleven sectors. Between 32%. Undervalued and 44%. Undervalued. I have never seen the market. That undervalued and at the same time so technically. Oversold. Now we have the opposite we're alleviating an -- what technical condition on the daily chart. But we had at last Friday as high as we have six out of eleven sectors now overvalued. And if you looked at banking after the stress tests. They were 18%. Overvalued after the press test results so clearly. The banking industry has the lead us out of it and it can't. But the banking industry can lead us back down which I believe it will only."