What a turn around!!! Last Wednesday things were really looking bad, for markets it was make it or break it. Thursday afternoon in Europe, ECB President Mr. Draghi re-affirms that any necessary actions will be taken to save EURO, especially when Spain bonds interest rates were rising. AND then a major reversal, US markets gaped up crushing anyone who was shorting this market. The momentum continued into Friday and now we are back in the game!!! What to expect next? Is this BULL rally for real!!!
Due to earnings season underway, Market is experiencing zig zag action. Euro-zone issues are still NOT resolved while another issue "US Fiscal Cliff" is on the horizon. In addition to this, BRIC countries economic growth is subsiding there by suggesting global slowdown. All this news is not market friendly and could cause a very nasty decline similar to what we saw in 2011 August. But for now trend remains in uptrend, have patience and wait for signal.
Last to last Friday we got a BUY signal and then following four days a continuous market decline, does not provide confidence, does it!!! And then a relief on last Friday BUT are we out of the woods yet?
It was a short week due to 4th of July holiday and Market continued to inch higher before Fridays jobs report crashed the party. However, earnings season shall start from next week and market should find support soon. Most likely earnings should drive the market higher for next couple of weeks. But DO NOT forget that Euro-zone crisis is far from resolution hence it will be wise to assume that this BULL move may not last for months unless we see concrete actions from Euro officials. For now enjoy the party till it lasts...
Market has been struggling last month to stabilize after experiencing a correction which started in early April. The encouraging news out of Euro-zone saved the day on Friday. European political leaders at least showed some progress during Euro Summit which brought back investors confidence FOR NOW. However, we have yet to see the real action. remember, actions speak louder than words and ONLY time will tell in coming months where we are headed. It seems like we might be starting NEXT BULL move here.... Based on WHAT!!!
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