New Week, New Hope...

Welcome back from the long weekends!

Well, a new week and a new hope as I see the volatility coming to an end soon in favor of the bulls.

Looking at the weekly Dow chart, we see that despite the volatility over the last 2 weeks, the Dow has faithfully bounced off the weekly 30MA support line and has begun a nice followup to upside. Mid term momentum indicators also suggests a build up in mid term bullishness. On a daily time frame, the Dow has also closed above the important 30MA resistance line on growing volume. That has totally alleviated the fear that I mentioned last Thursday.

Sometimes, I cannot help but agree with the day Uncle Bernanke work. Uncle Ben totally understands the concept that the stock market is completely based on sentiments and not exact economic numbers. That's probably why he refused to cut rates despite pressure from every angle. Simply by throwing false promises and insignificant actions into the air, he has created a growing sense of optimism that has obviously helped the market so far. That is in fact good enough. Cutting rates is a last resort that he will use against real economic problems, not stock market problems, and that is in my humble opinion, extreme wise.

I look forward to an exciting and rewarding week ahead.


Dow Technical Chart By TC2007!