It occurred to me today while watching the markets that selling pressure has been overwhelmingly absent, for what seems a very long time now–barring a handful of days, about three months at this point.

This is just another way of viewing the lack of worthy consolidation–an obsession of mine throughout this rally–the endless ripping higher, the buying of every intraday dip, and every down day the next, in an unsustainable frenzy of greed feeding greed, and going wholly unpunished. Eighteen months of losing money, apparently, brings out the piggy chaser in a lot of us.

But why aren’t there sellers? was the question I spent the day asking myself. (I should have started asking it weeks ago, but never mind.) There are always sellers, or you don’t have a market. There is nearly as much horrifying news, new and old, to back them up today as there was earlier this same calendar year, and I don’t believe that every trader is a successful momentum/trend follower, or we’d have hit S&P 1500 by now. Not to mention how skittish the bulls were, for weeks–a good solid plunge would have bathed them in red sweat. But it never came.

Here’s what I came up with for reasoning. Number one, as discussed last night, institutions have some strong compulsion to hold these markets up above Scaryland. Number two, a lot of sellers panicked and threw in the towel in Q1 crash action, and those that didn’t are hardly going to close out their buy-n-holds as the market rips back toward distant overhead positive territory. (In short, there’s nothing for sale!) And number three–and this is the only one you can do anything practical with when it comes to trading–the bulls are now very much emboldened. Having bought hundreds of dips over twelve weeks, and gone totally unpunished every time, they have nothing to fear. No greed-blocker. No risk check.

Why is this significant? In order for this market to break down (or rather, stay down) as I believe it would if it told anything vaguely resembling the economic truth or served any sort of useful predictive function rather than just acting like a casino in ATM wrapping paper, the bulls now will have to be broken. Which means, in practical terms, that catching the “top” is going to be very tricky. Barring a crash (I never do, but I’m not gonna hold my breath, either), it’s not going to take one or two days of weakness to reverse this rally. Maybe it can’t even be done in a week. The dip-buyers and the dice-players are going to have to get spanked repeatedly before they’ll start paying attention to fact again.

There are no sellers. It’s my new mantra. What looks like selling is likely only profit-taking, these days. Jumping in long from here may be risky, foolish, and revoltingly greedy, but until proven innocent, count on the guilty strapping on their hoppy-boots.

I might reiterate, just for the sake of clarity, that I am not a bear, but a skeptic, and even a casual reading of the facts bears out this skepticism. The reason to bump along a bottom rather than veeing right out of it is that the economy is still deeply battered. (Consider this report on housing, which just about everyone agrees must improve for the economy to follow. It’s terrifying.) The markets now complacently nod along with all the second-derivative good news, and are quickly forgetting that something getting worse more slowly has a long way to go before it gets better, and might just as well decide to start getting worse more rapidly again.

I could not care less if a bunch of useless, grabby speculators–a.k.a. “traders”–get destroyed in another fat drop. As I’ve said repeatedly on this blog, my concern is the casual or managed investor, who is trying to read the economy accurately–and alas, that reading includes the silly, silly market–to save up some money for a house, a family, or a retirement. Having as I do zero faith in institutions or markets to protect these investors–no one really holds them accountable, after all, as “risk” is always the scapegoat–there is excellent cause for fear.

Clearly, the many institutions dumping new equity offerings into this rally agree with me. Why would they sell stock at today’s prices if in another three months they could be up another 40%? Corporate America: today’s only seller.

Without further ado, your recaps:

Good luck out there.