The Market surged higher this morning on news of a bailout package for Greece and other European nations if needed. The recent stock market decline may be over, but we cannot draw any conclusions based on the surge in buying this morning alone. The market was extremely oversold and due for at least a short term bounce. This morning’s bounce may be primarily due to short covering. It will be a couple days before we can put the recent sharp decline and this morning’s sharp advance in proper perspective. Just as we did not get caught up in the emotion of the day during the decline, we will not get caught up in the emotion of the current rally.
Our investment style and investment game plan is clear. We check our egos and notions of what the market should do at the door and let the market itself be our guide. If the rally holds I will begin to add some new positions this week.