One of the most relied-upon adages for the stock market was popularized three decades ago by market technician Martin Zweig on the PBS series, "Wall Street Week With Louis Rukeyser." Zweig observed that stock prices tended to rise when the Federal Reserve was easing monetary policy, and that they tended to fall when policy was being tightened.
That adage seemed to be at work again today as stock prices rose after Fed Chairman Ben Bernanke indicated that more active easing may be imminent.
I think this is one time not to follow the adage, as Fed easing has been anticipated for some time. Market sentiment measures reflect too much optimism for me, so I still advise caution--and patience--in anticipation of better values to come.
S & P 500: 1407