It was quite a ride up yesterday.

Never in my time doing stock trading and online trading has there been anything like it. Of course, it was a record increase, so it’s all history.

It is really a matter of confidence. If most of us feel that the markets have been stabilized, then stocks will continue to perform to the upside. If not, then this will only be a brief rise. The fear has not reached the retail level yet, but last week it was close. Perhaps last week was the bottom.

Now, for anybody involved in online stock trading, including individuals as well as online stock brokers, there is the question of what stocks and opportunities are out there. Some companies have suffered real losses, and even if the stock market indices ratchet upward, there is no guarantee that the businesses that have lost so much capital can recover and prosper.

I pulled out my research from last week and looked through it. I had looked into a number of market segments, with the idea that sooner or later a bottom would be reached, and that there were concrete investments to make.

I looked again at the financial sector. Now that the US government is going to be buying stocks in large banks, some of those might prove interesting. My focus, however, will be on those banks that were never in any jeopardy of folding, because they had not been involved in making or holding any sub prime paper. There are not many of those.

This kind of makes for a strange dilemma. Should I buy into the well managed banks, which were never in trouble, and most likely won’t be in trouble. Or do I buy into the larger banks that will be partially owned by the government? Will the “government” banks actually be unfair competition to the ones left in the free market? That could be. And if so, their stock prices will remain depressed.

It was quite a ride up for the markets, and it will probably go up again today. I just wonder how long the upside will be sustained, given that a plan of some sort has to ultimately show results. I guess there is that window where the confidence will remain high due to a grace period, but if it becomes clear that confidence is still low, things will begin to sell off again.

Only time will tell on this. We are in completely uncharted territory. Some fortunes have already been made, and more will be made. It’s just going to take paying attention to a lot of detail.

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