There is fantastic action across the board today as we see retail waking up, homebuilders reversing, and in my opinion the most important factor, many low priced names starting to pick up steam again. Telco stocks are waking from their slumber of 2003 and it seems as if people are placing their bets that product replacement cycles will drive this sector higher through 2004.
The dollar is catching a bid and there are many rumors flying around about why. The most popular has been that Soros is selling Euros. Whatever the reason, the market moved higher on the news and it seems as if people are having no problem buying stocks! That is causing me to scale back on my own bullishness.
To illustrate this point, I want to share with you something that happened to me this morning. I was speaking with an old friend of mine today who has been itching to buy this low-priced stock. The stock had some news out on it and it popped about $0.30. Since the stock is so low priced this is a rather big percentage move. My friend was frantic! He couldn't make up his mind whether to buy it off the news or to wait for it to pullback.
I am not exaggerating when I say that I could hear the fear in his voice. The fear of missing the next move. The fear of missing out on making money! Take this one example and expand it to the entire general public. One could say that a fair amount of fear would exist if everyone felt this way. In my opinion I think that people are more fearful now of missing out on the potential of making money, then they are about LOSING money. That's a dangerous mentality and I think that it is something to note.
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