February 2, 2010
GROUNDHOG DAY... AGAIN
Stocks rose on better pending home sales data (up 1% vs down 17% previously) and homebuilders reported better earnings courtesy of tax benefits and the $8K home buyers’ credit. Further, analysts were busy upgrading companies like Alcoa and Exxon. The latter always get the benefit of the previous close to mark their cost vs the opening price like most of us commoners.
Short-term oversold conditions are now officially relieved even with volume running a little below the previous week’s selling. Perhaps sellers have exhausted themselves and buyers can come in and squeeze shorts out of their positions. The latter has been the common experience since the rally began in March as every dip has been bought. Breadth today was positive but less so on the NASDAQ as tech is still finding its footing with volume focused on bigger names per WSJ.
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