We have seen a clear deterioration in the market’s short-term trend but this is a welcome event helping to alleviate the market’s overbought condition. With the market’s intermediate-term and long-term trends and momentum still in bullish territory coupled with cyclical leadership, we have a very robust market that is likely to head to new highs once this short-term pullback exhausts itself.
The intraday reversal in the markets Wednesday is of big interest and importance to traders and market technicians. Since the Jon Hilsenrath article, almost two weeks ago, investors have put more weight again on any tapering talk from the Fed.
In this partial transcript of Dr. Marc Faber's interview airing Friday, he discusses why central banks should be manipulating the price of gold higher, whether massive retail buying signifies a bottom, the real state of China's economy, and much more.
Perhaps THE biggest event so far this week was the breakout in 10-Yr UST yields today north of 2%. As shown below, the 10-Yr UST broke the bearish trend that has been in place since 2011.
The S&P 500 was down 0.83% today and the Dow was lower by 0.52%. From peak-to-trough today the S&P 500 was down 2.3% in today’s trading. Fed Chairman Bernanke’s comments about the possibility of tapering stimulus in the “next few meetings” moved investors to take profits today after an early spike to new highs this morning.
Barry Bannister, Managing Director of Equity Research at Stifel Nicolaus, joins Financial Sense Newshour to discuss whether to “Sell in May and go away” as well as the stark parallels between now and the 1930's.
The elusive bottom in Chinese stocks is becoming more constructive here with a higher low being put in, above the 200-day moving average. MACD signaled a buy in May and is moving into positive trend territory on the daily chart.
Investors have increased their appetite for risk as the market continues to climb to new highs. There was a tremendous amount of fear in April that growth was not going to be sufficient to maintain such lofty levels on the major averages. Economic data was beginning to surprise to the downside and many felt that a long awaited pullback was just around the corner.