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This sell-off following the release of QE2 over the past several weeks is coming to an end. There's a good chance that Monday, November 29, 2010 was the low of this sell-off, and that we're about to go into full-fledged melt-up rally mode again. Expect to see a breakout to new highs before the close of the year. I'm setting a target of 1265 on the S&P 500 for 2010.

Even if we see incremental new lows over the next few days, the absolute bottom will be in on the employment report which generally has the tendency to mark the start of a new trend in the market. Expect significant inflows into U.S. equities as funds flee global equities in favor of domestic stocks. Funds will continue to chase performance into year end and expect significant QE2 Pomo dollars to drive stock prices way higher as fund managers assume more risk heading into year end.

While sovereign debt concerns in Europe might continue over the coming weeks, I expect U.S. equities will be the biggest beneficiary of the continued outflows from European equities as global equity funds continue to take advantage of a weaker dollar through the Euro carry trade. Expect Apple (NASDAQ:AAPL) to see new all-time highs no later than next week as technology stocks lead the market higher into year-end. I still expect to see a significant melt-up rally that will continue for the majority of 2011.

Disclosure: Long January QQQQ calls.