Dow Up on More Optimistic Data

The Dow gained 103 points today as Durable goods order and Jobless claims turned in better than expected. Especially important is Durable goods order turning in a positive number this time round, indicating renewed economic activities.

Sadly, even though both economic numbers are important and beat expectations, the Dow merely made another sideways day within the 8500 / 8300 squeeze that I mentioned yesterday without any signs of a breakout. In fact, the Dow fell way short of yesterday's high. Investors are also wary of how tomorrow's GDP number would turn out (see Stock Market Calendar). Consensus is for a rebound, in line with most of the economic data that we have recieved so far. The only question is, has this GDP rebound already been priced into this intermediate rally so far? Yes, the rally has ben strong without strong reasons then... could this be the reason? If it is, investors would have all the reasons to take profit even if the GDP do beat expectations. But one thing is sure, the long term propects for the market looks very good from this point forward. It is the short term swings we are trying to interpret here and to pin point as closely as possible each turning point. My analysis yesterday stands.