Major Averages Hit New 2011 Highs!

Tuesday, April 26, 2011
Stock Market Commentary:

Stocks rallied on Tuesday sending the Dow Jones Industrial Average, tech-heavy Nasdaq composite, and the benchmark S&P 500 index to a fresh 2011 highs! The market is back in a confirmed uptrend and remains healthy as long as all the major averages continue trading above their respective 50 DMA lines. The recent healthy action was in response to a series of stronger than expected Q1 results and a host of solid economic data. Now that the market is back in a confirmed rally, odds favor higher, not lower prices lie ahead.

Q1 Earnings, Weaker Dollar, Consumer Confidence, & Housing Data Lift Stocks

Stocks opened higher as the US Dollar (UUP) fell to fresh 52-week low and a slew of companies released stronger-than-expected Q1 results.  The Conference Board said consumer confidence rose to 65.4 in April from a revised 63.8 in March. The report topped the Street’s expectation of 64.5 and bodes well for the economic recovery. Elsewhere, housing data remains bleak as the S&P/Case-Shiller  Home Price Index fell for an 8th consecutive month in February which brings it eerily close to the April 2009 low. The S&P/Case Shiller index measures home prices in 20 major metropolitan areas around the U.S. and fell –0.2% to 139.27. The reading was slightly above the April 2009 low of 139.26.

Market Action- Market In A Confirmed Rally

From our point of view, the market is back in “rally-mode” as all the major averages continue to trade above their respective 50 DMA lines and are flirting with, or at, fresh 2011 highs! In addition, leading stocks have held up very well even as the major averages slid below their respective 50 DMA lines in mid-April. If you are looking for specific help navigating this market, please contact us for more information.

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