Still Hanging On…
The US market continues to be range bound as the Dow closed down by 50 points today.
Even though the ADP employment report was disappointing today, it didn’t stop the market from opening up strongly and staying high for most of the day on great factory orders. Profit taking stepped in towards the end of the day as profit takers continue to retreat out of this grossly over-extended market.
With most of the economic indicators already at pre-recession levels, investors are now watching out only for signs of a recovery in the job market. They didn’t get any reassurance today. Investors are likely to continue retreating out of the market tomorrow ahead of the long weekend and jobs report coming on Friday itself.
The US market have been moving largely sideways for a week now and it has certainly taken some of the short term overbought sentiment away. All short term overbought markets can resolve either by pulling back slightly or going into a significant sideways trend like we are witnessing now. The market continues to be amazingly resilient to a pullback as new short term bullish signals continue to appear in stocks across the board. Despite all of these resilience, the possibility of a pullback to about 10,700 continues to be extremely high.
For now, the Dow continues to be in an all out bull trend.
Chart of Dow Made Using Telechart. Want Your Own Charting Software? Download FREE Now!
