Support Hangs Tough
The drop last week took the various averages to just about where support was to be anticipated. In the S&P 500, that was the 1395-1400 area. So in spite of the deluge of uncertainty coming from our Washington politicos, it looked as though the markets were about to rally, if only temporarily. It appeared that somehow the politicians would pull a rabbit out of a hat at the last minute.
The Arms Index moving averages had become somewhat oversold on a short-term basis, and the VIX had moved a long way away from the levels of extreme complacency of recent weeks. Everything but the news pointed to a market advance. And that is what we have now seen reluctantly materialize. It looks as though it will go further in the next few sessions. But be aware, the longer-term work is far less sanguine. A rally in here is likely to become a selling opportunity, in my opinion....214 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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