A Positively Lethargic Week...

The Dow closed up 3.06% this week. It was supposed to be a very encouraging week if not for the lethargic trading volume. The lethargic trading volume suggests that there is little public participation nor excitement behind that move. Without a strong public support, no trends can be sustained. Looking at the weekly charts, the Dow has bounced off its 30MA support level very nicely and certainly looks like it is ready to move much higher if we see some increased participation next week. I see the key to further upside as a break on strong volume above the 12500 psychological resistance level. One thing that might make that break difficult will be crude price. Crude rose above $62 on Friday as tensions rise in Iran. 15 British sailors, along with their patrol boat, are being retained by Iran claiming an intrusion into Iranian waters. We will see how that situation develops and its future impact on crude prices.


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