Here Is An Excerpt From FindLeadingStocks.com’s Intra-Week Update. If You Want To Buy Leading Stocks…EARLY.
All Eyes On The ECB
Holding Pattern Continues
Ahead of Thursday’s ECB Meeting
The U.S. stock market is holding up rather well as global markets continue trading all over the map and earnings are being released in droves. The fact that the market is not falling in and of itself is a subtle, yet important, bullish sign. The next technical hurdle that the market faces is its 50 DMA line. It is very possible to see the market “bounce” into its 50DMA line then roll over and fall hard. That is typically the “norm” in downtrending /weak periods. In most cases, support (recent lows) resides just above the 200 DMA line… So clearly, the next move wins. [On a lighter note, this is an advanced technical pattern known as a moving average sandwich (joking)]
Therefore, ECB meeting (or enter latest headline of your choice) aside, the bulls want to see the market jump back above the 50 DMA line and continue moving higher. Clearly, it is very important to see how the market reacts to the ECB meeting tomorrow and more importantly where it closes on Friday (weekly close).
Outlook: Cautiously Bullish
Overall our stance has not changed- we remain cautiously bullish. We feel the market will move higher (mainly because of the central bank put) but know that this bull market is “aging” and there are many bearish signs emerging in the periphery. Furthermore, if deflation gets out of control, or if the market stops reacting so well to all the interference from global central banks- then all bullish thoughts are removed from the equation.