The Dow lost 1,525 points in October, or 14%, to 9325. In the past week, it gained back 946 points or 11.3%. The S&P 500 lost 16.9% or 197 points to 968.75 for the month. In the past week, it rose 91.98, or 10.5%. The Nasdaq slumped 17.7% or 370 points to 1720 for the month. It was up 10.9% in the past week.

One factor that contributed to the relatively bullish sentiment of the last week trading sessions is that bargain hunters have started to come back into the market, as values of even large, stable household names plunged.

Apple Inc, which has plunged from about $200 at the start of the year to just above $100 and just broke $110; can AAPL go up another 10% or 20%?

Yes there are very high possibilities that AAPL remain strong through the end of the year moving forward to 2009. Just by looking at the chart alone I can see that:

1. The stock price has moved above the 3 DMA lines forming a “W” bottom.

2. The MACD Histogram is positive indicating strong bullish momentum.

3. Last week’s gain was the most bullish week in the entire year for Apple.

When the retail investors and institutional funds are coming off the sidelines to get back into action, it will stage a rally in the weeks ahead.

October was the worst month for stocks since 1987. The same volatile month also saw the past week’s 10 percent gain, the biggest weekly advance since October 1974.

The recent market’s huge selloff is mostly the result of an unprecedented financial crisis, which is pushing the economy toward a long and painful recession. The election will be a positive because it ends a period of uncertainty.

Stocks are likely to get a bounce after Tuesday’s presidential election, but worries about the economy and credit crisis may keep the rally short. It is better to be a little more caution as the focus may quickly shift back to the economy when jobs data is released Friday.

“The individual investor should act consistently as an investor and not as a speculator. This means.. that he should be able to justify every purchase he makes and each price he pays by impersonal, objective reasoning that satisfies him that he is getting more than his money’s worth for his purchase” - Benjamin Graham

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On Wednesday U.S. stocks staged another ditch turnaround to end mostly lower sending the Dow Jones  back below the 9,000 level during the end trading session after surging 889 points, the second biggest-point jump a day earlier.

The Federal Reserve cut its federal funds target rate as expected lowering its key overnight lending rate to 1% from 1.5%, bringing the fed funds rate to its lowest level since 2004. The Fed said growth has slowed markedly and the extraordinary financial market stress could put the economy at greater risk.

Wednesday’s market was particularly volatile, although for a good part of the day it was unusually calm as investors waited for the Fed’s rate decision. In the final half hour, stocks staged another round of drama.

The Dow Jones Industrial Average rising 250 points only to erase the gains in the final minutes of trading. The Dow industrials shed 74.16 points to end at 8,990.96. The S&P 500 lost 10.42 points to 930.09, while the Nasdaq Composite gained 7.74 points to 1,657.21.

Stocks will likely remain volatile on Thursday as investors will be focusing on third quarter GDP and weekly jobless claims. Economists expect a decline of 0.5%. Is the U.S. going into a recession yet? GDP is also now likely to support the recession argument.

The definition of a recession is a decline in a country’s gross domestic product (GDP), or negative real economic growth, for two or more successive quarters of a year.

Third quarter real GDP will be near flat. Due to the gas prices, home prices, and higher unemployment, everyone feels its like a recession. This is in part because the stock market is down, and it is often taken as an indicator of the economy which didn’t lead to a recession in the first three quarters of 2008.

The outlook into 2009 is for a sluggish economy at best, but the specifics depend highly on how well the liquidity crisis on Wall Street is addressed. That remains highly uncertain.

“People are only mean when they’re threatened, and that’s what our culture does. That’s what our economy does” - Mitch Albom

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On Monday, U.S. Stocks were slammed again at the close to end sharply lower after multiple fits and starts, with a September rebound in new-home sales failing to stem ongoing fears of a worldwide recession.

Equities pulled back as crude-oil futures ended Monday’s volatile session down for a second day after earlier rising to $65.77 a barrel.

After trading in a 450-point range, the Dow Jones Industrial Average piled on the losses in the last 10 minutes of trade, falling 203.18 points, or 2.4%, to 8,175.77. The S&P 500 Index declined 27.85 points, or 3.2%, to 848.92. The Nasdaq Composite Index also dipped back into negative territory, down 46.13 points, or 3%, at 1,505.9.

Volatility has surged across financial markets as investors are forced to sell assets which they bought with borrowed money to repay creditors or cover margin calls as asset prices fall and credit limits are breached.

The credit crisis, which began with failing U.S. mortgages, has mushroomed into a worldwide rout as investors sell stocks and commodities, shun risky emerging markets and seek out only the safest of government bonds and currencies.

Stocks in Hong Kong tumbled as investors who had bought shares on credit were forced to sell in a falling market. European investors followed suit, with more trouble in the financial sector after a German retail banking group reported a quarterly loss.

The still-tight credit markets are anticipating a half-point interest rate cut from the Federal Reserve this week, but investors are worried it won’t be enough to quickly revive the economy.

The Fed has been slashing rates and taking unprecedented action to get market participants back in the lending mood, including launching a facility Monday to buy the short-term corporate debt known as commercial paper.

After the two days Fed’s meeting which ends on Wednesday, the market predicts it will be down to 1%, the same low level by former Fed Chairman Alan Greenspan in 2001.

“Speculation is an effort, probably unsuccessful, to turn a little money into a lot. Investment is an effort, which should be successful, to prevent a lot of money from becoming a little” - Fred Schwed Jr.

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