A potential Obama win is based on the idea QE3 and ZIRP will continue. That's about all I can glean from reading comments posted on a variety of popular websites.
Bulls like money printing and the added liquidity it provides for trading with HFTs. Stocks inflate in the short-term, and that is the intended effect desired by Bernanke & Co. Long-term issues being resolved is for another day.
If this is the outcome, we all just have to deal with it.
Since it isn't a certainty, we'll just post a few charts once again.
Volume was light on this melt-up, as the action picked up after Europe closed. Breadth per the WSJ was positive.
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The NYMO is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60, markets are extended short term.
The McClellan Summation Index is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.
The VIX is a widely used measure of market risk, and is often referred to as the "investor fear gauge." Our own interpretation is highlighted in the chart above. The VIX measures the level of put option activity over a 30-day period. Greater buying of put options (protection) causes the index to rise.
That's enough charts for this day, as tomorrow will bring us more conclusive (hopefully) news regarding the election.
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The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell any security. Market sectors and related ETFs are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period. Chart annotations aren't predictive of any future market action rather, they only demonstrate the author's opinion as to a range of possibilities going forward.