Still Sideways...
The sideways trend continues into a second week last week as the Dow continues to trade within its 10955 - 10800 short term neutral channel.
However, the two weeks of sideways trading has allowed the US market to digest most of its short term overbought condition and should be up and running again within these couple of weeks. For this week, I still see the Dow sideways or even slightly downwards. Perhaps not a strong one but at least a significant single day pullback.
The market is going to greet a positive open on Monday as last Friday's unemployment rate did not move higher as some have feared. Yes, make no mistakes, peak unemployment rate happened back in October 2009, marking the worst this recession can get. The economy is on the recovery but at a much more gradual and modest pace. The mess that has been created in the economy is going to take many more years to completely unwind.
However, the two weeks of sideways trading has allowed the US market to digest most of its short term overbought condition and should be up and running again within these couple of weeks. For this week, I still see the Dow sideways or even slightly downwards. Perhaps not a strong one but at least a significant single day pullback.
The market is going to greet a positive open on Monday as last Friday's unemployment rate did not move higher as some have feared. Yes, make no mistakes, peak unemployment rate happened back in October 2009, marking the worst this recession can get. The economy is on the recovery but at a much more gradual and modest pace. The mess that has been created in the economy is going to take many more years to completely unwind.
posted by Jason Ng at 9:18 PM
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