The last few days have been enough to test any bear's resolve -- all the fundamentals stink and yet the market keeps going higher. But we're confident that this rally is teetering on its last leg and due for a huge fall.
The reason: Investors are way too optimistic about the economy right now. They're hanging their every hope on a big recovery soon. But that's not going to happen. Sure, some companies have met their earnings estimates. Remember, they've been slashing these estimates for more than six months. Even beating those lowered estimates isn't going to bring back the type of growth that powered the bull market of the 90s. Most companies continue to warn about future earnings, signaling that the next six months may be even worse. When investors face the reality that there won't be an instant recovery -- they're going to dump their stocks and run for cover!