Stocks prices went up again today. However, trading was fairly weak, most probably due to the lack of data, and also it’s colombus day.
Financials could not rise, causing this rally to stall. If financials rise, then the market will continue its rally. Unfortunately, today’s actions might initiate the reversal. We have seen 2 false reversals 2 weeks ago. When will the real one occur?
The market tested the S&P 500 support at 1161 for a brief 3 seconds as buyers quickly bought shares at that level.
Towards the end, some traders decided to dump shares into the hands of novice traders or lucky winners.
Once again, today’s trading can’t really tell much. I am going on a short bias now, it has to be confirmed by either a gap down tomorrow, or a huge red marubozo candle.
The dollar is deeply oversold, and some short covering might take place, putting immense pressure on stocks and oil.
I am looking closely at Bank Of America. The latest buzz about the poor foreclosure handling has caused banking stocks to take a larger beating. I think investors are waiting at the sidelines before entering these bank stocks which may face serious lawsuits and threaten the economy.
That’s all for now. Happy trading.
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