Last weekend, in my Market Forecast, I said, “So, the market is looking healthier. For the new week, if the market continues to rally above the 30-day MA, we could see the above mentioned resistance range tested. It’ll be very interesting to see how the market positions itself before the next Fed meeting, which is on 12/11. Staying above the daily MAs would be a good (bullish) sign.”
The market did indeed rallied above the 30-day MA and SPX is now within its resistance range, 1500-1520. The market made solid gains this week. For the week, the Dow added +253.86 points; SPX gained +23.52 points; and Nasdaq garnered +45.2 points.
On Monday, the market was weak, as RIMM got downgraded. On Tuesday, the market continued to vent, but, we saw some solar stocks making HUGE gains. On Wednesday, the market woke up from its nap and charged back up, while investors bought up the Chinese ADRs! On Thursday, the market continued where it left off the day before. We had a fun and happy day, cashing in on some good profits! On Friday, the market ended flat, although there were some very healthy stocks, and we wrapped up a pretty nice week!
The Dow managed to gain +5.69 points on Friday, as SPX and Nasdaq closed flat, giving up 2.68 and 2.87 points, respectively.
Here’s how the market closed:
Most sectors were flat. INX2 (Internet) and BTK (biotechs) closed slightly in the red; on the other hand, SOX (semiconductors) and SWH (software) made it slight in the green. USO (oil), OIH (oil services), and UNG (natural gas) were weak. GLD (gold) and GDX (gold miners) were down, while XME (metals and mining) went up! XLF (financials) gave back 1.33%. FXI (Chinese ADRs) lost 4.1%. However, PBW (clean energy) jumped +3.21%!
SPX
SPX gave up just 2.68 points to close at 1504.66, still within the 1500-1520 resistance range. Its 20-day MA has turned up and the 30-day MA is turning. The MACD continues to rise.
Nasdaq
Nasdaq lost 2.87 points to close at 2706.16. It daily upper BB has begun to open up and the 20-day MA is turning. The MACD continues to rise.
For the new week, I think the market has positioned itself nicely before the Fed meeting on 12/11 (Tuesday). It has gotten above the daily MAs with the daily upper BB opening up to make room for more upwards movments, which is what I was looking forward to last weekend. The market looks prepared to push things higher if the Fed continues to show its readiness to help the economy and the subprime mortgage problems. We’ll continue to hold lots of cash and make quick trades as the opportunites present themselves, until the market demonstrates a confirmed reaction to the Fed’s next rate decisions.
Hope you’re having a nice Saturday! I’ll be back tomorrow to look at some individual sectors.
Good night and HappyTrading! ™
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[...] line). On the other hand, this quick drop might give some of the high-flyers more breathing room. This weekend, I said, “We’ll continue to hold lots of cash and make quick trades as the opportunites [...]
[...] Last week, I said, “The market looks prepared to push things higher if the Fed continues to show its readiness to help the economy and the subprime mortgage problems. We’ll continue to hold lots of cash and make quick trades as the opportunites present themselves, until the market demonstrates a confirmed reaction to the Fed’s next rate decisions.” We made very few trades this week, comparing to some of our busier weeks, and are still holding cash to wait for clearer signals from the market. [...]
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