Dead Cat Bounce?

FUNDAMENTAL ANALYSIS
Worries about the US economy took the market down early before buyers still betting on a Santa Claus rally rushed in for a deal, taking the market back up by the end of the day. So, what changed today? Nothing really. Housing Starts and Housing Permit numbers today (see economic calendar) continued to paint an ugly picture of the housing market, both plunging by 3.7% and 1.5% respectively. So, what's the deal with the rebound on the second half of today? A Dead Cat Bounce?

ALERT! Do you own a finance or stock market website? Are you an investment advisor or service provider? Here is your chance to advertise your site and service on the #1 Option Trading Site, OptionTradingpedia.com! Optiontradingpedia.com is the #1 search result under "Option Trading" as well as "Options Trading" on Google! Optiontradingpedia.com released its advertising service yesterday at very reasonable rates! Check it out now!

TECHNICAL ANALYSIS
Not surprising to see a couple of small candle days after 2 huge triple digit ditches. However, if the Dow continues strong tomorrow, closing higher and perhaps beating the high of 17 Dec, it could be the start of the turnaround that I have been talking about for the past few days! Which means Santa Claus rally might be late but it certainly is coming! So, once again, we are in critical times. Here's a case for a rebound... the 200MA crossed and moved above the 30MA, indicating a grossly oversold condition in the Dow. Every time that happened over the past few years, the Dow moved up higher significantly for the short term and long term. Weekly chart still look great as the Dow found great support on the 50WMA. So, technically, there are more evidence to upside than downside and all it takes now is for some big institutions to catch on and act on it. :)


Dow Technical Chart By Best Charting Software TC2007!