Ben The Market Savior!

FUNDAMENTAL ANALYSIS
Even though Uncle Ben's in the habit of disappointing the market, when he really act to save, he do it beyond everyone's expectations. The Feds not only cut 50 basis points off the Fed Fund Rate but upped the poker by further cutting another 50 basis point off the discount fund rate! This way, the economy will get an instant dose of steriods through the immediate help rendered to banks and financial institutes through the discount rate cut and be ensured of recession curbing through the Fed fund rate cut. These cuts will definitely help alleviate the current credit situation, keep more people in their homes, save more mortgage lenders from bankruptcy and eventually, improve spending and consumer confidence. The Dow was trading with a 70 points gain just minutes before the release and quickly scaled to a stunning 20 points gain within just 20mins of the release and then end the day with a huge 335.97 points gain. We have not seen such a strong single day gain since 2002!!! Well, enjoy the bull for now and do not be surprised to see a couple of profit taking days... it is time speculators enjoy the wins of their high risk bets.

TECHNICAL ANALYSIS
Well, definitely a fundamental ruled day. The Dow's gain has enabled it to make a strong break above the 50MA resistance line at last! The Dow has been struggling at this critical level for a couple of weeks and if it failed to make a break, it might correct back down and laspe into a full bear trend. I see the next short term resistance level at 14000... the new high. In the meantime, we might see some profit taking but the staircase formation should resume. Enjoy the bull.


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