Analysis:
The market initially did what yesterday's analysis predicted. As the Consumer Confidence Index did not slip below 50, and the Chicago PMI was marginally better than consensus forecast, the market did take off after 10 a.m. But the market's rise was checked when the FOMC meeting minute was released at 2 p.m. and finished the day flat. After the last seven trading days the Bears should feel tired, as the market stubbornly refused to follow any prodding to plunge below 1,040. Looking ahead to tomorrow, the PMI will likely surprise on the upside, which will prod the market higher, but any rise will be checked and partially offset by the Construction Spending release.
Strategy:
Hold long to reverse at 1,080
Tuesday, August 31, 2010
Monday, August 30, 2010
S&P 500 Index Analysis (8/30/2010)
Analysis:
True to previous day's analysis, the market built on Friday's gain to top 1,072 overnight before fading prior to the market open today. The conventional wisdom is that the market sold out on the news of a meager personal spending in July, but the sell-out seems to have been overdone, especially in light of the continuing wave of mergers which the market largely ignored today. Looking ahead tomorrow, barring the scenario of a dip of Consumer Confidence Index below 50, the Chicago PMI will likely surprise on the upside around 59, which will provide much needed confidence booster for the market to recoup all today's losses.
Strategy:
Hold long to reverse at 1,082
True to previous day's analysis, the market built on Friday's gain to top 1,072 overnight before fading prior to the market open today. The conventional wisdom is that the market sold out on the news of a meager personal spending in July, but the sell-out seems to have been overdone, especially in light of the continuing wave of mergers which the market largely ignored today. Looking ahead tomorrow, barring the scenario of a dip of Consumer Confidence Index below 50, the Chicago PMI will likely surprise on the upside around 59, which will provide much needed confidence booster for the market to recoup all today's losses.
Strategy:
Hold long to reverse at 1,082
Friday, August 27, 2010
S&P 500 Index Analysis (8/27/2010)
Analysis:
Today the S&P initially acted strangely, and it is most puzzling when it
dropped sharply after 10 a.m., perhaps having to do with Intel's ill-timed
announcement at 9:58 a.m. The better than expected downwardly revised Q2 GDP
to 1.6% provided a sound backdrop for the Bulls to start with, and Chairman
Bernanke's comments at 10 a.m. gave assurance to the much battered Bulls, so
the market never looked back after a brief swoon at 10 a.m. Now that the
market has bottomed out from the 1,040 area, it will continue to build on the
upward momentum on Monday.
Strategy:
Hold a long position with a limit order to reverse at 1,082
Today the S&P initially acted strangely, and it is most puzzling when it
dropped sharply after 10 a.m., perhaps having to do with Intel's ill-timed
announcement at 9:58 a.m. The better than expected downwardly revised Q2 GDP
to 1.6% provided a sound backdrop for the Bulls to start with, and Chairman
Bernanke's comments at 10 a.m. gave assurance to the much battered Bulls, so
the market never looked back after a brief swoon at 10 a.m. Now that the
market has bottomed out from the 1,040 area, it will continue to build on the
upward momentum on Monday.
Strategy:
Hold a long position with a limit order to reverse at 1,082
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