Optimistic ISM Services Lifts Stocks...
The Dow gained 44 points today as investors pushed against the early bears upon release of a better than expected ISM services number (see Stock Market Calendar.
The ISM services or ISM Non-manufacturing Index, is the cousin survey of the more influential ISM Manufacturing Index. ISM stands for Institute for Supply Management is an Arizona-based group representing purchasing managers in the US. It put out two major surveys each month to these purchasing managers to produce the two indices mentioned above. In fact, the ISM index is one of those indices watched by the Fed in deciding on monetary policies. The ISM services is not as influential as the ISM index itself but investors definitely acted on it today as the sentiment in the market turned from bearish to bullist almost upon release of today's higher than expected number of 47. Yes, it seems like investors are totally hungry for more positive data right now in order to convince them of an entry. I believe many of these are those who has missed the rally so far due to skeptism.
On the technical front, trading volume continues to be below average and short term bearish momentum continues to rise as the Dow made yet another lower low and lower high today. The daily 200 days moving average also seem to be depressing the daily highs. For now, nothing suggests that the intermediate rally we had so far is continuing. Odds remains favorable for an intermediate term pullback that will tell us whether this is a reversal in progress or a continuation of the primary bear trend. For now, the Dow remains in short term neutral trend, intermediate term bull trend and primary bear trend.
The ISM services or ISM Non-manufacturing Index, is the cousin survey of the more influential ISM Manufacturing Index. ISM stands for Institute for Supply Management is an Arizona-based group representing purchasing managers in the US. It put out two major surveys each month to these purchasing managers to produce the two indices mentioned above. In fact, the ISM index is one of those indices watched by the Fed in deciding on monetary policies. The ISM services is not as influential as the ISM index itself but investors definitely acted on it today as the sentiment in the market turned from bearish to bullist almost upon release of today's higher than expected number of 47. Yes, it seems like investors are totally hungry for more positive data right now in order to convince them of an entry. I believe many of these are those who has missed the rally so far due to skeptism.
On the technical front, trading volume continues to be below average and short term bearish momentum continues to rise as the Dow made yet another lower low and lower high today. The daily 200 days moving average also seem to be depressing the daily highs. For now, nothing suggests that the intermediate rally we had so far is continuing. Odds remains favorable for an intermediate term pullback that will tell us whether this is a reversal in progress or a continuation of the primary bear trend. For now, the Dow remains in short term neutral trend, intermediate term bull trend and primary bear trend.
posted by Jason Ng at 7:44 PM
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