Last week, market pulled back in smaller steps and currently sitting at support. Everyone will try to tune in for ECB's comments next week which shall provide near term direction for the markets. What can we expect!!! BPNYA is well above EMA(30) and for now market remains bullish. However, keep an eye on volatility index which is creeping higher. It is clearly visible from below chart, as volatility rises, market has hard time to climb smoothly and becomes very choppy with lot of confusing signals. Market currently resting at support is visible on below daily NYSE chart. If support holds then next target will be 8200 area and if it breaks then next target will be 7900 area. In either scenario, market still remains in UP trend and this can be considered as pullback. Weekly NYSE chart below displays a different picture. Dotted line resistance seems to hold which means we shall see a decline unless the resistance is broken decisively. Expect more volatility in near term, which could mean wide market swings in either directions. Historically month of September is not considered bullish and a decline can be expected. This decline may lead FED to announce QE3 which in turn will deliver a rally as election date approaches and for rest of the year. ONLY time will tell whats in store for us.
For now stay focused and be alert... Comments are closed.
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