Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
US Presidential Election Year Stock Market Seasonal Trend - 29th Nov 24
Who controls the past controls the future: who controls the present controls the past - 29th Nov 24
Gold After Trump Wins - 29th Nov 24
The AI Stocks, Housing, Inflation and Bitcoin Crypto Mega-trends - 27th Nov 24
Gold Price Ahead of the Thanksgiving Weekend - 27th Nov 24
Bitcoin Gravy Train Trend Forecast to June 2025 - 24th Nov 24
Stocks, Bitcoin and Crypto Markets Breaking Bad on Donald Trump Pump - 21st Nov 24
Gold Price To Re-Test $2,700 - 21st Nov 24
Stock Market Sentiment Speaks: This Is My Strong Warning To You - 21st Nov 24
Financial Crisis 2025 - This is Going to Shock People! - 21st Nov 24
Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities - 18th Nov 24
Why President Trump Has NO Real Power - Deep State Military Industrial Complex - 8th Nov 24
Social Grant Increases and Serge Belamant Amid South Africa's New Political Landscape - 8th Nov 24
Is Forex Worth It? - 8th Nov 24
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Egypt Resolves... Stock Market Resilient...

Stock-Markets / Stock Markets 2011 Feb 12, 2011 - 06:35 AM GMT

By: Jack_Steiman

Stock-Markets

Democracy. The people of Egypt were fighting to remove autocratic leadership and create democracy for themselves. The market had been somewhat shaken recently over rioting in the streets. It was a reminder of the recent past riots when we also had to deal with the flash crash. The market didn't like all that rioting in the streets not too long ago, and was clearly worried a bit that this could happen again. It should not happen as President Mubarak has stepped down.


That headache is now out of the way and any bad news that gets resolved in a positive way can only be good news for the bulls and bad news for the bears. The market is dealing with bad news in the way that all bull markets do, and that is to put it aside and play spin doctor with it. Such was the case with the old leadership stock in Cisco Systems, Inc. (CSCO). This baby used to move markets in a huge way, but it no longer seems to have any influence whatsoever. A real positive change of character as new leadership has come along and taken over.

That is a necessary part of the evolution of all bull markets. Bad news is now being ignored, with the market clearly focusing on the overall earnings picture, which remains solid for sure. One after the other is coming out with good news. Although there are always the losers in the stock world, the majority is doing quite well, and some are absolutely blowing the cover off the ball. As long as that continues, it will be hard to kill this beast of a bull.

Of course, the other main factor that goes in to a bull market is having the fed on your side. No one will deny that the fed is on the side of this stock market. It wants Wall Street to thrive which, in turn, will help Main Street thrive as well. If Main Street is thriving it keeps the economy humming. It seems almost a guarantee that fed Bernanke will keep rates where they are for a long time to come. It's also quite likely that printing press Ben will keep those machines on 24/7 by 365 days. That money has to go somewhere, and it's likely that money will go in to the stock market over time, especially if things hold up as more and more folks will get nervous about missing the good times.

To me, it seems as though there's nothing printing press Ben won't do to keep this bull moving along. Thus, you have to remember to never fight him and go along with everything even if you think morally what he's doing is wrong for the bigger picture. I hate what he's doing bigger picture, but my job is to recognize market direction. That direction is still higher, although there will always be pullback's along the way, of course.

We closed approximately 2% below the 2007 highs at 2060 on the Nasdaq. It seems to want to go up and test there now, but no guarantees, of course. If we do get there, I believe that's where this market will start to struggle. Long-term resistance areas are tough to get through when you're extremely overbought, which we would be if we get that high. Always computer related selling at major areas of long-term resistance, thus, it would be best to lighten up as we get closer to that level.

2755 is now solid support or the back test of the trend line breakout. The further away we get from it the more secure that area will be for the bulls. It's already acting as good support, so if we can get up near 2860 it will become stronger support still. It would be best to test back near there at some point so we can unwind and get far more aggressive. However, we have plenty of scratch in the game now, so let's hope we can work our way towards Nasdaq 2860.

For months, all we heard about was how bad the financials were and how they wouldn't be recovering any time soon. Quietly, it seems as if things aren't talked about much any more for this group of stocks. They continue to move higher on a two-steps-up, one-step-back pattern. The fact that they're doing well no longer seems to surprise anyone. A lot of very prominent people in the world of fundamentals have been telling us how these stocks would be dead for a long time and go much lower.

They are now strangely quiet about those dire forecasts. Clearly, the masses got too bearish on this group, and the trade was apparently full. Once it stopped working to the down side the bears seemed to have given up and covered their positions. Lots of fuel available for upside action. As long as the financials continue bullish so will this market and now, to bolster the look of things, there are many gap ups in the patterns there to keep the bears at bay.

Stay with the long side trade, folks, until we get a true sell signal. For now, that's nowhere in sight. With bad news being ignored for the most part, stick with the reality that earnings are good and that printing press Ben is still printing daily. This combination bodes well for a while, knowing that to come along will be the usual set of pullback's along the way.

Do something nice for someone just because you can, and play with a child if you get the chance this weekend. True life perspective will certainly come your way.

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Sign up for a Free 21-Day Trial to SwingTradeOnline.com!

© 2011 SwingTradeOnline.com

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constitutinginvestment advice. Trades mentioned on the site are hypothetical, not actual, positions.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in