Once again, how people that do not understand how financial markets work, and this includes the media who write about what caused the prior days move in the newspapers, make these comments is beyond me. I suspect he is trying to get everyones goat here. Obama ducked every meaningful question, so how anyone could say that speech was a market mover either way is laughable. I know he seems to be a hard core liberal from reading his posts, so I think he is just trying to stick it to you guys, and celebrate his victory. Let’s all hope Obama does well by all of us, it is time to move on and quit pouting about the outcome. Time will tell, opinions about what he might do are worthless.
However, the real reason for the bounce is that the .618 retracement off the high was 898.65 and the intraday low was 897, so almost right on the money in the SP futures. Alot of professionals especially fund managers buy into retracements at these levels, that is what caused the bounce. It is a low risk probing point during pullbacks, and a friend of mine that manages several billion is always a player at these levels. This is how markets work, fund managers don’t sell millions of shares of Microsoft or IBM they have accumulated over a several month span, in the middle of a politicians speech because of some arbitrary view of what that might mean 6 months down the road. Small frys who get emotional might, but that does not move the market, when someone sells 500 shares in a panic.
