It was the first worst thanksgiving week since 1932 for US stock market. Since Europe is driving this market, the first thing to check in the morning is how is FTSE trading. http://www.google.com/finance?q=INDEXFTSE:UKX and where is Italian bond yield, http://www.bloomberg.com/apps/quote?ticker=GBTPGR10:IND and followed by EUR/USD http://data.cnbc.com/quotes/EUR%3dX/tab/2
Dow opened flat, followed by 110 point rally and then pulled back 130 points. EUR/USD opened at 1.333 and then it slipped to 1.322, followed by small pull back to 1.328 Since Eur/Usd was weak throughout the morning, any rally in FTSE or Dow wasn't going to last long.
If Eur/Usd start showing strength, then any rally will last longer. Also rising Italian bond yield is not helping either, its at 7.26 (Danger level). Since ECB President is from Italy, he wont let Italian bond to rise drastically. ECB has been buying the bond aggressively.
So why be bullish at this level when everything is bearish ? The reason is its holiday season; Thanksgiving, Chirstmas and New year are three big event. US and Europe economy is driven by people spending their money whether they have it or they use credit cards. Greece will be getting 8 billion Euro before Dec 6th which will avoid Greece default and strengthing the Eur/Usd. On an average Dow has rallied 800- 1200 point from November end to mid January. I am very bullish for December and 1st week of January and optimistic about all the stocks listed in http://www.freefdawatchlist.com/2011/11/technical-level-hal-amzn-aapl-tna-bac.html
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