Sun 10 May 2009
What a week for the bulls! Talk about a strong week. Right from the start on Monday morning, the market was bid up. It seems that all news is good news at this point, and above the resistance at 88, it looks like mutual funds have started buying into the move they missed off the lows, after the dismal year that was 2008. On Thursday we saw our first sign of weakness, but the release of the stress test results caused another spike up in the market on Friday. We closed right by the week’s highs, so we’ll have to see what happens at the 93 level this upcoming week. Above there I would be looking for the SPY to have a little bit of trouble at the 94.50 level.
So let’s take a look at a few important articles from the week:
An interesting chart of the Dow priced in relation to gold. When you look at this chart, you see that priced in terms of gold, we’ve been in a bear market for the last 10 years.
Some speculation on the possibility of the dollar collapsing as the Chinese begin to move away from it. As I’ve said before in this section, this is a long term fundamental shift to keep an eye on.
A lot of chatter going around about the vanishing consumer credit. People with almost perfect credit scores are being denied credit. For a market that has rallied sharply on the GDP number which showed that consumer spending looks to be showing signs of life, this isn’t exactly what you’re looking for.
A really good analysis on NYSE high-low volume off the lows compared to the 2003 bear market end. Something is odd when the high-lows have basically flatlined since the March lows. Furthermore, correlation is still running high in the markets.
All traders are always seeking to improve. But we’re not always asking ourselves the right questions to get to that next level. Dr. Steenbarger has helped re-shape some problem focused questions into solution focused questions.