Buffett Bounce Evaporates, All Eyes On The Bernank Tomorrow

The major stock indexes have declined faster than they rallied after the announcement of the Bank of America deal with angel investor Warren Buffett. At first, many traders and investors thought this was good news, now it is really turning out to be a negative report for the investing public. This shows the world that perhaps even the banks in the United States may need more capital. All of the leading financial stocks have faded from their gap higher open. Stocks such as J.P. Morgan Chase & Co. (NYSE:JPM), and Goldman Sachs Group Inc. (NYSE:GS) have given back most of the early morning gains. Leading tech stocks such as VMWare Inc. (NYSE:VMW), and Amazon.com Inc. (NASDAQ:AMZN) are also under some selling pressure.

Tomorrow, the Federal Reserve Chairman Ben Bernanke will speak in Jackson Hole, Wyoming. More pressure than ever will be on Chairman Bernanke to try and say something to help prop this market up. It was just one year ago that Chairman Bernanke signaled to investors that he would do another round of quantitative easing coined QE-2. That QE-2 program ended just ended in June, and it is unlikely that Chairman Bernanke will announce another round of quantitative easing.

Many traders seem to be are taking profits off the table this morning since they know that Bank of America was in worst shape then originally thought. We can only wonder what will be said tomorrow and more importantly how the market will react after the Bernanke speech.

About Nicholas Santiago 575 Articles

Affiliation: InTheMoneyStocks.com

Nicholas Santiago started trading in 1991. In 1997, he became a licensed Series 7 and 63 registered representative. He managed money for a large, affluent private client group. After applying his knowledge to his client base, he decided it was time to begin teaching those interested in learning his methods. He is an expert in Technical Analysis. He has become an accomplished technician in the studies of Elliot Wave, Gann Theory, Dow Theory and Cycle Theory. In 2007, he partnered with Gareth Soloway to form InTheMoneyStocks.Com and realize his dream of educating others about the truth of the markets.

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