A 300-point Dow gain -- be very afraid
As Merrill Lynch's David Rosenberg and Big Picture's Barry Ritholtz pointed out yesterday, every 300-point rally in the history Dow Jones Industrial Average has come during bear markets -- times of overall steep stock declines. Barry's conclusion: "Hence, the odds are against making money chasing these 300+ point rallies."
Today's stock market would seem to reinforce the trend. The Dow was up 300+ points on Tuesday. But following a new spike in initial unemployment claims this morning and disappointing retailing news, the Dow at this moment is down 135 points.
