Tuesday, May 12, 2009

Bulls Remain in Control

After a rough start in 2009, the Canadian Trade Report came in at a surprise 1.1 Billion surplus versus the forecast 0.5 Billion.  This combined with the almost $60/barrel oil is boosting the Canadian dollar to over $.86 US.  The US Dollar continues to decline against all major currencies.  Gold and silver are also spiking in the futures markets this morning in response to the continued weakness in the US Dollar.  If the markets continue in a positive vain today, this will be the tenth straight week that the Nasdaq has risen, which is quite unusual from a historical perspective.  Another interesting development is the announcement by Microsoft (MSFT) that it will issuing debt for the first time.  The banks also pulled back yesterday due to the dilutions which will occur due to the additional capital that is being raised. 

The DAX is positive this morning and so are the futures, indicating a positive open for the markets.  The market condition scans and the market bias indicators are showing a more neutral stance, although they also indicate a slight bias to the upside.  The bullish sentiment remains.

I am still of the opinion that stocks have extended to the upside and need to rest, digest the gains, and build momentum again.  Therefore, risk for new entries is high.

Index

Change

%Change

Level

Phase

TSX

-143.85

-1.41%

10094.14

Recovery

DJIA

-155.88

-1.82%

8418.77

Recovery

Nasdaq

-7.76

-0.45%

1731.24

Recovery

SP 500

-19.99

-2.15%

909.24

Recovery

Russell 2000

-9.88

-1.93%

501.94

Recovery

NYSE

-151.09

-2.52%

5849.30

Recovery

Source: Telechart

Short Term market outlook:

Bias: Scans showing a neutral bias but more positive momentum than negative momentum

Energy: moderate

 Primary Trend: Remains down to sideways

Sector

Phase

Consumer Staples

Recovery

Healthcare

Recovery

Technology

Recovery

Utilities

Recovery

Energy

Recovery

Financials

Recovery

Industrials

Recovery

Materials

Recovery

Consumer Discretionary

Recovery

Source: Telechart 

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