The Panic Of The Professionals Creates Market Bottom. Lange Financial Services Market Update. Remains Bullish

[ 0 ] March 23, 2011 |

The Panic Of the Professionals Creates Market Bottom.   Market Update From Lange Financial Services.  Bullish

Lange Financial Services   Wednesday March 23, 2011  11:45am ET

In Mid February of this year, we were anticipating on this site a market pullback in the range of up to 5% that could possibly bring the DOW down to about 9800, or the upper end of the projected range of 3%-5%.   The markets were acting as we believed they would until a major event that was completely unexpected and impossible to predict occurred, that being the combination of the Japanese earthquake, Tsunami, and concurrent nuclear meltdown possibility that made the headlines daily.  The called for nuclear meltdown was exacerbated by the media in the same line as the gulf oil spill that was going to be the worst disaster in USA history, yet the bulk of the oil seemingly disappeared. The events in Japan are certainly tragic indeed, with 10,000 lives lost and more missing. Its a sad and unfortunate event and we wish the best for all the families there in this period of extreme crisis and sadness.

These events in Japan drove the DOW down to about 9600, overshooting our maximum target of 9800.   The decline from above 12,000 to about 9600 on the DOW, with other indexes declining more so, was nothing more than the Panic selling by Hedge Funds and so called Professional investors as many literally ” ran for the exits “.

On March 16th we put out a ” BUY” memo, on this blog, on the markets and favored stocks, and followed this up here on March 18th confirming out thoughts that the markets and quality stocks listed on the site should continue to be accumulated.  The volume in the markets increased substantially and a market Bottom was created as the hedge funds and other professionals stopped panicking.

The market has now rallied to back over 12,000 since our last two buy memos.  Whether a test of the 9600-9700 on the DOW will be forthcoming is difficult to say at this time but if it does so happen we still believe that it would be a superb  buying opportunity and would not be overly concerned.  In any event, we believe that any near term weakness remains a buying opportunity to accumulate well positioned, quality companies that are enjoying earnings growth we expect into 2012, that we have mentioned here on the site.

In looking at the markets yesterday and today, we can see the selling pressure drying up which after the decline and subsequent rally back to over 12,000 is a positive. We remain bullish.

Some of our favored stocks are:

Apple  ( AAPL )

Alpha Natural  ( ANR )

Apache  ( APA )

Anadarko  ( APC )

Devon Energy ( DVN )

Cliffs Natural  ( CLF )

IBM  ( IBM )

MetLife  ( MET )

3M  ( MMM )

Peabody Energy  ( BTU )

McDonalds  ( MCD )

Decker  ( DECK )

Deere  ( DE )

Qualcomm  ( QCOM )

Google  ( GOOD )

Fred and Rob Lange, Lange Financial Services.

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Category: Markets and Trading, Technology