Archive for September, 2009
Economic Releases Miss Estimates and Spark Light Profit Taking!
Yesterday, the market traded in a very tight range after a nice rebound on Monday. M&A activity and third-quarter “window dressing” got the week started on a positive note. As I’ve been saying, traders are searching for any piece of information that might drive the market. Today, there were a number of economic releases that are influencing trading. The ADP employment index showed a larger than expected drop (254,000) in jobs during September. Economists had expected a decline of 210,000. August’s employment number improved by 20,000 and that helped to soften the blow. Traders are seeing improvement and they aren’t too …
Expect Choppy Trading Ahead of the Unemployment Report - Watch SPY 105!
Yesterday, the market staged an impressive one-day rally. Most traders have been looking for a top and last week’s key reversal after the FOMC meeting had many thinking that the long-awaited decline might start – wrong again. The market has been able to climb a “wall of worry” during the last few months and every little dip finds immediate support. Asset Managers are under allocated and many have missed this move. They do not want to be left behind during a year-end rally and they are aggressively bidding for stocks. The end of the third quarter is upon us and “window …
Merger Monday Provides A Boost - Expect Choppy Trading - Stay Bullish!
Interest rates and earnings drive the market. Yields continue to drop and last quarter’s profits were much better than expected. Last week, the Fed stated that they would remain accommodative. Low interest rates are good for corporations and consumers. After the news was released, the market rallied a bit and then staged a key reversal. Stocks closed on their low of the day Wednesday and that set up technical selling on Thursday and early Friday. By Friday’s close, the market found a bid. Earnings season will start up in two weeks. This recession is more than a year old and that …
Expect Nervous Trading Ahead Of The Unemployment Report - Wait For Support Then Buy!
Wednesday, the Fed gave the market what it wanted. They are committed to keeping interest rates low and that is good for businesses and consumers. The market had a positive reaction after their statement, but it was not able to push higher. In the last hour of trading, profit-taking set in and the market staged a key reversal. Many technicians watch this price action carefully since it often signifies a top. Yesterday, initial jobless claims came in better than expected. That sparked a brief rally on the open, but sellers quickly pushed the market lower. Existing home sales were weaker than …
Key Reversal Set Us Up For Weakness Today. Wait For Support and Get Long!
Yesterday, the market rallied after the FOMC maintained their current policy. They will continue to support low interest rates and they did not outline an exit strategy. This is good news for businesses and consumers. Unfortunately, bulls ran out of gas and by the close, the market staged a key reversal. Technicians watch this price action very closely and that set us up for weakness today. Before the open, initial jobless claims fell 21,000 to a seasonally adjusted 530,000. That was better than analysts had expected and the four-week moving average dropped to 553,000, the lowest since January 24th. This shows …