There's Going To Be Some Market Testing

So the Markets rallied Monday, October 13. Tuesday's response was tepid with the Nasdaq falling 3.54%, and the Dow and S&P 500 declining less than 1%. That's not too bad given the wide swings I think we're used to by now. People are waiting to see what's going to happen.

Feeling bad that you didn't time the markets correctly by not buying anything on Friday the 10th? Or were you in my situation, where my brokerage had problems transferring funds on time?

Personally, I think that there will be some testing where prices will fall again to near Oct 10th levels, especially with still very negative consumer sentiments. In addition to that, the worst is not yet over. How could the markets have bottomed when we still expect to see more foreclosed homes, higher unemployment rates, and credit swaps unwind completely?

What about the financial industry and stocks liks GS, MS and BAC? We saw huge gains in the past few days after Sunday's G7 talks. I thought they were undervalued last Friday because of extreme fear. For instance, GS dipped down to $74.00. Now, they seem to be at more sane levels. For bargain hunters out there, financial services aren't something to go into for now.

We should be looking at the top-quality stock bargains out there. I like BA - although I have a feeling they will continue to fall little by little over the month or so since the negotiators are making little headway with the machinist's union on strike right now. Another favorite is GE. They're huge, solid, and still have room to grow internationally.

Next, more to come on my reactions and forecasts to the next few days of the market's roller coaster ride. Can't wait to see what happens.