Hope you've had a nice, long weekend! It's time for us to look at the markets again! Last weekend (it feels like a long time ago), I wrote:
"For the new week, the market has been working hard to whittle away the selling momentum to establish a bottom. It can now push higher. VIX has come down a bit. SPX has resistance at 1200, above which we could see the momentum turn up and draw more buyers back in. Between 1260 and 1280, the market could see more resistance. Tech stocks have been strong, but, the market will need commodity sectors to gain strength to break higher. Financials have started to strengthen, which is a bullish sign."
The market started out the week as expected. By Tuesday, we pretty much locked in profits on our upside trades, and, I said, "We might need to see a couple of days of mixed market and wait to see if the above-mentioned resistance levels have turned into support. Watch the financials, they will be among the key sectors to make or break this rally!" We stayed in mostly cash on Wednesday and Thursday, as the market pulled back to test the support levels. Financials started to slip on Thursday. On Friday, the unemployment report drove the market down, and, the financials were especially weak as the government sues big banks over mortgage losses.
For the week, the Dow was down 44.28 points; SPX fell 2.83 points; Nasdaq ended flat, actually up 0.48 of a point! Gold soared back up to near $1900/ounce and was slightly up for the week. On Monday, Asian markets fell sharp. This evening, at the time of this writing, Asian markets were mostly lower again. Let's take a look at where the US market stood after Friday's close:
SPX fell 30.45 points to close at 1173.97. It closed right at its 20-day MA. MACD went flat.
Nasdaq dropped 65.71 points to close at 2480.33. It managed to close above its 20-day MA. The MACD also flattened.
Both SPX and Nasdaq fell on Friday, but, managed to closed just above their respective 20-day MAs. For the new week...
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