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MARKET WRAP UP 11/30/10
For the second session in a row, stocks gapped down hard at the open, only to quickly find a bid before chopping around until the closing bell to finish down 0.61% to 1180. While both the rising 50 day moving average and the key 1173 level continue to hold on the S&P 500, the bulls would be foolish to complacently assume that they could do no wrong. Falling in love with the idea of being “the comeback kids,” while consistently trying to dig yourself out of a hole will eventually end badly. At the same time, with the transportation and small cap stocks holding up impressively and outperforming, as well as many enticing individual setups, the bears do not seem particularly eager to take the lead either.
In essence, the two weeks of consolidation to close out November has everyone wondering whether it is of the bullish or bearish variety. My technical indicators still indicate that the bulls deserve the benefit of the doubt. With that said, trying to discern a choppy range is the equivalent of stepping out of the shower and applying too much heavily medicated Gold Bond Body Powder. Is the burn healthy, constructive and natural? Alternatively, is the sharp burning sensation merely a harbinger of terrible things to come?
Indeed, only time will tell.
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$XLF looks hideous. Williams %R is rolling over and needs a “reset” out of O/S territory, and watch those 50 DMA’s, without those…the bulls are naked. And FWIW SPX 1228 is the 61.8% Retrace of the bear market everyones forgotten about. Until we hit new highs we could possibly still be at the tip of Wave 2(The Bull in a Bear) of a bear market. I’m not screaming look out…I’m just being extremely cautious. No need to push whats been a great run.
Warning: Extra Strength Gold Bond = Bad burn.
You ain’t lying- I put that on my fromunda zone once. ONCE.
thanks chess… no need to worry , ben’s got our back. gap up tmrw and run with tonight’s china ISM? Repeat from beginning of Sept.
It looks to me that the risk is rotating out of the emerging markets and into the small caps. I would have thought that the M&A fever would have been more prevalent, but I do understand how the expectation of growth in the emerging markets could outweigh the small cap fervor.