The Staircase Continues...

FUNDAMENTAL ANALYSIS
The Dow closed down by a thin thin thin 0.25 points yesterday as investors take a short breather after Thursday's gain. On the bright side, Bank of America stepped in and took a huge stake in the ailing mortgage lender, Countrywide Financial. Country Financial is the biggest mortgage lender in the country and has went into a bear trend since Feb 2007, shredding over half of it's share price since! This gave further evidence that the banking system is not about to just let the credit crunch take as many "lives" as we all think it will. There is still a lot that can be done to salvage the housing market and prevent a recession. One such thing is a cut in the Fed Fund rate... we all know it is coming.. but when?

TECHNICAL ANALYSIS
The Dow traded sideways today, beginning another step in the staircase formation. Bullish momentum on our short term indicators continue to build up healthily and I see the staircase formation going up to the 13500 resistance level where we need to reassess if there is enough strength in the market to break the resistance level.


Dow Technical Chart By Best Charting Software TC2007!