Steve W from Ford

Technicals: Where Is the Pullback? What Pullback?

Many commenters, along with Tyler Durden, seem to think the recent rally and in particular the fast rise in the financials following WFC announcement is unjustified. Some have said the WFC profit guidance was expected by "everybody".
This is wishful thinking. I have followed the bank stocks over the last 3 months intensively and I can tell you that while some "expected" good earnings this quarter many many did not. Do you not remember that LAST WEEK Mike Mayo was saying the banks were dead meat walking? At least half of all analysts seem to think the banks will fail while the other half think they are undervalued. Certainly no consensus there.
The WFC announcement is the first REAL evidence the big banks will survive and actually may prosper in the current environment and THAT is big news and justifies a big run up.
When you have the financials go from possibly being zombie banks to earnings stars in one week I'd say that justifies quite a run up in the market. One can argue that the earnings are fictional or won't last or that other banks will report much worse earnings but you can't argue there is nothing behind the rally led by financials.
When your bank goes from being possibly on the brink of failure to looking solid it is good for most any company and removes quite a lot of uncertainty from the market.