Stocks fell after Alcoa Inc. (AA) reported slightly disappointing Q1 results. From our vantage point, the current rally is under pressure as all the major averages are falling hard towards their respective 50 DMA lines (Nasdaq Composite & NDX already violated their 50 DMA lines). The 28-week rally, which began on the September 1, 2010 follow-through day (FTD), ended on Thursday March 10, 2011 when all the major U.S. averages plunged below their respective 50 DMA lines in heavy trade. However, the correction was short lived when a new rally was confirmed on Thursday March 24, 2011′s healthy action. Since then, the action remains healthy which suggests the bulls are back in control of this market.
Stocks & Commodities Fall As Earnings Season Begins:
Crude oil plunged over -3% for the second straight day as a host of other commodities also fell in heavy trade. So far, crude oil is down nearly $10 from its post recovery high, slightly above $113/barrel hit earlier this month. On another front, earnings season officially began and investors appear to be “buying the rumor and selling the news.” Stocks rallied over the past few weeks (buy the rumor) in anticaption of Q1 earnings and now that we are here, equities are under modest pressure (sell the news).
Market Action- Rally Under Pressure
The current rally which began with the Thursday, March 24, 2011 FTD is now under pressure as the Nasdaq composite & Nasdaq 100 both closed below their respective 50 DMA lines. Remaining objective, it is bullish to see the other popular averages all trading near to slightly above their respective 50 DMA lines. However, if that important level is breached, then lower, not higher prices, likely lie ahead. If you are looking for specific help navigating this market, please contact us for more information.
Host Of The #SmartMoneyCircle Podcast, Founder and CEO of 50 Park Investments. Adam provides weekly market updates to ChartYourTrade.com readers. He is a FORBES Contributor and is a frequent guest on all the major financial media outlets.
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Disclaimer: All communication from ChartYourTrade is general in nature and for educational and general informational purposes only. Under no circumstance should it be considered personalized investment advice. All our work is general in nature and not specific to any one person. All the information on this site and/or that originates from us, or any of our partners or affiliates, is for educational and informational purposes only and is NOT a recommendation to buy or sell anything. To avoid any conflicts of interest, we do not have a working relationship with any of the companies mentioned in our work. Furthermore, we may have a long, short, or no position in any, or all, of the names that appear in our work and they may change at any time without notice. Investing and trading in capital markets or using margin carries a high level of risk and may not be suitable for all investors. Leverage can work against you as well as for you. Before you decide to invest or trade in capital markets you should carefully consider your investment objectives, level of experience, and risk appetite, among other factors. The possibility exists that you could sustain a loss of some, all, or more of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with capital markets, investing/trading, and seek specific investment advice from an independent financial advisor and other professionals. Remember all the information we provide is for educational and general informational purposes only and is subject to change without notice.
50 DMA Line Is Under Attack!
Tuesday, April 12, 2011
Stock Market Commentary:
Stocks fell after Alcoa Inc. (AA) reported slightly disappointing Q1 results. From our vantage point, the current rally is under pressure as all the major averages are falling hard towards their respective 50 DMA lines (Nasdaq Composite & NDX already violated their 50 DMA lines). The 28-week rally, which began on the September 1, 2010 follow-through day (FTD), ended on Thursday March 10, 2011 when all the major U.S. averages plunged below their respective 50 DMA lines in heavy trade. However, the correction was short lived when a new rally was confirmed on Thursday March 24, 2011′s healthy action. Since then, the action remains healthy which suggests the bulls are back in control of this market.
Stocks & Commodities Fall As Earnings Season Begins:
Crude oil plunged over -3% for the second straight day as a host of other commodities also fell in heavy trade. So far, crude oil is down nearly $10 from its post recovery high, slightly above $113/barrel hit earlier this month. On another front, earnings season officially began and investors appear to be “buying the rumor and selling the news.” Stocks rallied over the past few weeks (buy the rumor) in anticaption of Q1 earnings and now that we are here, equities are under modest pressure (sell the news).
Market Action- Rally Under Pressure
The current rally which began with the Thursday, March 24, 2011 FTD is now under pressure as the Nasdaq composite & Nasdaq 100 both closed below their respective 50 DMA lines. Remaining objective, it is bullish to see the other popular averages all trading near to slightly above their respective 50 DMA lines. However, if that important level is breached, then lower, not higher prices, likely lie ahead. If you are looking for specific help navigating this market, please contact us for more information.
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Disclaimer: All communication from ChartYourTrade is general in nature and for educational and general informational purposes only. Under no circumstance should it be considered personalized investment advice. All our work is general in nature and not specific to any one person. All the information on this site and/or that originates from us, or any of our partners or affiliates, is for educational and informational purposes only and is NOT a recommendation to buy or sell anything. To avoid any conflicts of interest, we do not have a working relationship with any of the companies mentioned in our work. Furthermore, we may have a long, short, or no position in any, or all, of the names that appear in our work and they may change at any time without notice. Investing and trading in capital markets or using margin carries a high level of risk and may not be suitable for all investors. Leverage can work against you as well as for you. Before you decide to invest or trade in capital markets you should carefully consider your investment objectives, level of experience, and risk appetite, among other factors. The possibility exists that you could sustain a loss of some, all, or more of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with capital markets, investing/trading, and seek specific investment advice from an independent financial advisor and other professionals. Remember all the information we provide is for educational and general informational purposes only and is subject to change without notice.
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