Friends
The bull market pattern continues. After being down 100 Dow points early this morning, stocks once again had a nice reversal and finished the day just about flat. This pattern has been in place so far this year, with stocks opening lower and recovering as the day progresses. This is a very positive trend for stocks, as you get weak hands selling shares early each day and strong hands adding shares near the close. A bear market is just the opposite, where each morning weak hands try to pick up bargains, only to be overwhelmed by sellers as the day wears on.
Today’s reason for the reversal was a positive Pending Home Sales number and German approval of the Greek bailout. As a result, the Dow Jones Industrial Average (after crossing 13,000 again) was down a mere 1 point to close at 12,981. The S&P 500 was up almost 2 points to finish the day at 1367, after getting above our magic 1370 level just briefly. Gold was down $8.20 to close near $1768 and oil was down $2.13 to finish the day at $107.68 per barrel WTI.
We have a bundle of economic data coming this week, along with speeches from various Fed governors, so once again we will be able to get an indication as to whether this recovery remains on track. What we are concerned about is the rising cost of gasoline and how it may affect the recovery. We will keep you informed as the week unfolds. In the meantime let’s see if the bullish pattern can continue.
Have a nice evening everyone.
