US Market Today Daily Columns by Mr. OppiE
US Market Today - Mr. OppiE (Author Profile)
Nov 5, 2009
The Dow broke out today to upside by 203 points as the bulls overcome profit takers at last, closing the Dow at 10,005 points.
Yes, the Dow is once again at the 10,000 points level. This time round, the Dow is much more ready to make a committed breakout at it is now slightly off short term oversold with bullish momentum now rising. This is unlike the last time the Dow challenged the 10,000 points level last month in its already short term overbought condition. With today's rally, the Dow once again defended its intermediate bull trend pattern of bouncing off its 30 or 50MA to new highs. Odds now favor a bullish breakout and tomorrow's Job Report might be the catalyst needed. Is the Dow ready to stage a breakout into the growth market mode?
For now, the Dow returns to a short term bull trend within an intermediate and primary bull trend.
Chart of Dow Made Using Telechart. Want Your Own Charting Software? Download FREE Now!
US Market Today - Mr. OppiE (Author Profile)
Nov 4, 2009
The Dow started the month optimistically, closing up by 76 points on better than expected ISM index.
The strong follow up that we are hoping to see did not happen,instead, all we saw was that profit takers were still very much in control of the situation, beating down the market right after today's FOMC Announcement. Yes, profit takers were merciless in securing positions in cash even though the Fed did everything right, destroying what is to be a strong follow up day. Yes, if the market ended as strong as it was before the Fed announcement, investors might have enough confidence to start coming back in again. That didn't happen. This puts the Dow in an extremely perilous position jammed sideways between its 30 and 50MA. The good thing about today's market action is that it left the Dow with a reversal of its short term bearish momentum so its pretty much neutral now. There are obviously bulls in the market but they are just not as shrewd as the profit takers.
For now, the Dow remains in short term neutral trend within an intermediate and primary bull trend.
Chart of Dow Made Using Telechart. Want Your Own Charting Software? Download FREE Now!
US Market Today - Mr. OppiE (Author Profile)
Nov 2, 2009
The Dow started the month optimistically, closing up by 76 points on better than expected ISM index.
The US economy continues to present optimistic report cards as the ISM index turned in far better than expected. ISM index released this morning turned in 55.7 versus last month's 52.6 and beating consensus of 53. In fact, this reading is now way higher than any of the ISM index readings back in the bullish 2007! Hold on, what is this ISM index anyway?
The ISM Index is the Institute of Supply Management Manufacturing Index. It is also known as the ISM manufacturing index with its sister ISM services index sometime later this week. The index is compiled from a survey of 300 manufacturing firms and is the first economic indicator released every month. Its correlation with real GDP is what made it a heavyweight economic indicator watched even by the Fed. In fact, an ISM index reading of 50 has been consistent with a real GDP growth of about 2.5% with every full point adding another 0.3%. Generally, a reading above 50 indicates economic expansion while a reading below 50 indicates economic contraction. That made today's 55.7 an indication of economic expansion without a shadow of a doubt.
Traders and investors obviously welcomed the great news, pushing the market up in the morning before once again succumbing to profit taking pressure in the afternoon. Even though there was obviously still much profit taking in the market, the Dow did once again bounce off its 50MA, strengthening it as its intermediate term support level. But lets not rejoice too early. We do need to see a strong follow up tomorrow before we can lean the edge towards the bulls. For now, sentiments remains more bearish than bullish.
For now, the Dow remains in short term neutral trend within an intermediate and primary bull trend.
Chart of Dow Made Using Telechart. Want Your Own Charting Software? Download FREE Now!
US Market Today - Mr. OppiE (Author Profile)
Nov 1, 2009
Welcome to a new month! Let's hope the new month brings a new breakout and new profits for all of us!
What was shaping up to be a rebound last Friday turned out as a dismal week with the Dow down 2.6% on the week, ending right on top of its 50MA line again.
Yes, the only explanation so far is the widespread consolidation sentiment near the 10,000 points level as the most important data last Friday, the Chicago PMI turned in way better than expected and above the 50 line at last, indicating economic expansion. Yes, traders have been taking profit whole week last week, bringing the Dow out of short term overbought and back down into short term oversold condition again. A look at the weekly charts doesn't make this retreat any more threatening than the many pullbacks that we have got along this rally so far. This means that the integrity of this rally is still intact for now. We need to see a rebound off the 50MA this week in order to preserve this rally. This is going to be a heavy weight week with the ISM index on Monday, FOMC Announcement on Wednesday and Jobs report on Friday (see Stock Market Calendar) and those numbers would certainly be the key to providing that much needed boost back to the 10,000 line.
For now, the Dow turns short term neutral trend within an intermediate and primary bull trend.
Chart of Dow Made Using Telechart. Want Your Own Charting Software? Download FREE Now!
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