And Again China

So right now you know I think it's China that wags the market dog's tail.  On cue futures are up on news of talks commencing between the US and China today amid a more positive vibe out of the two countries on the basis for formulating a deal.   Of course given the most recent trading history we could be down 500 points by the end of the day.  Hard to make any sense out of these opens.  Buyers are on strike, spooked by all the volatility and most of the day belongs to the program traders.  

However, if we can get some stability on the China front then there is a higher probability that we see some sort of rally into January.  Most years I would give you an 80-85% chance that we'd be up higher by the December 31 close but this isn't most years.  Right now I'd peg odds of a rally only between 60-70%.  That's assuming we don't see negative developments on the trade front.  Oh, and it would be nice if the President would lay off of his twitter feed for a bit as well.   If there was ever a stage and a time for stocks to put in some sort of meaningful bounce it would seem to be now as we are again oversold enough for us to rally.  I still think we could potentially see a 4-5% rally between now and year-end.  However, I also think that potential for higher prices {or not}  will largely be based now on news events and not market fundamentals.

Back Thursday.