Its been two weeks, US government is in partial shutdown mode as jokers in Washington DC are NOT able to reach an agreement about US budget deficit. On Thursday, last week came a news about possible break through between two parties and market rallied for two days and October 17th is the deadline. Whats in store for us? BPNYA continues to remain above 70 mark and Volatility ($VIX) spiked due to the drama in Washington DC. Market managed to bounce back from the trend line which acted as support level. However, market rose on lower volume hence the move remains suspicious. On weekly chart below, divergence continues to remain between Price and MACD, RSI. Considering current situation, if a deal is NOT in place by Monday morning then market is going to take U-turn and wipe out all the gains in last 2 days. However if a deal is in place then market may make NEW HIGH in coming days. BUT the divergence shown above remains a BIG concern and since we are into earnings seasons, expect lot of volatility ahead which would result in zig-zag action.
What does it mean for our Investments?
Market remains vulnerable hence be cautious... Comments are closed.
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