Welcome Back From Independence Day
Welcome back from the Independence Day Long Weekend! What a week it has been last week!
The Dow made it's biggest single week rally for the year 2011 last week, gaining a whopping 648 points in a single week. The last biggest single week gain was back in March 2011 when the Dow reversed out of a short term correction. The Dow also did this reversal on the back of its 30WMA, which makes it an extremely credible end to the current intermediate correction. Indeed, this intermediate correction seems to be ending way too early... which once again mean that we are still overdue a significant correction of the kind we saw back in May 2010 and certainty demands some cautiousness going forward.
This reversal also came on the back of a much better than expected ISM index last Friday which gave it the fundamental support the market needed to confirm the reversal. The ISM Index bucked all previous leading indicators and turned in 55.3 versus a consensus of 52, which is lower than last month's 53.5. Indeed, analysts were expecting a poorer number this month due to all the leading indicators so far but the ISM index surprised everyone by turning in not only better than consensus but better than last month in a pattern that seems to suggest a few more months of better ISM index to come. Yes, such is the strong fundamental that is needed to end strong corrections.
Jobs report is going to be released this Friday and analysts are expecting a better showing this month and if analysts expectations are beaten once again, that could secure the market for yet another new high. Happy trading to all!
My Market Analysis Sent Straight Into Your Email Daily For Only $5/Month! **My analysis will only be posted here once every other day.
The Dow made it's biggest single week rally for the year 2011 last week, gaining a whopping 648 points in a single week. The last biggest single week gain was back in March 2011 when the Dow reversed out of a short term correction. The Dow also did this reversal on the back of its 30WMA, which makes it an extremely credible end to the current intermediate correction. Indeed, this intermediate correction seems to be ending way too early... which once again mean that we are still overdue a significant correction of the kind we saw back in May 2010 and certainty demands some cautiousness going forward.
This reversal also came on the back of a much better than expected ISM index last Friday which gave it the fundamental support the market needed to confirm the reversal. The ISM Index bucked all previous leading indicators and turned in 55.3 versus a consensus of 52, which is lower than last month's 53.5. Indeed, analysts were expecting a poorer number this month due to all the leading indicators so far but the ISM index surprised everyone by turning in not only better than consensus but better than last month in a pattern that seems to suggest a few more months of better ISM index to come. Yes, such is the strong fundamental that is needed to end strong corrections.
Jobs report is going to be released this Friday and analysts are expecting a better showing this month and if analysts expectations are beaten once again, that could secure the market for yet another new high. Happy trading to all!
My Market Analysis Sent Straight Into Your Email Daily For Only $5/Month! **My analysis will only be posted here once every other day.
posted by Jason Ng at 7:38 PM
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