Once again we saw the Dow Jones Industrial Average test its lows for the year at the all important 10,000 level. Why is it so important? This level is a key psychological level in the market. It is also an intermediate support level.
We have been covering this uncertainty for several weeks now. Uncertainty-breeds- volatility-which-breeds-opportunity. Could the market go lower? Of course, but when everyone expects a crash is when one WILL NOT HAPPEN. If this were September/October things would be less sure. However, it is rare for the market to collapse during this time of year. Some of our indicators show the market can go lower. Others are showing an oversold bias. What we are seeing is a crisis of confidence in the markets, mostly over the European situation. I suspect many investors may be cash-strapped right now and this may have been causing some of the selling lately. All they need is an excuse for more selling. Our domestic economic fundamentals remain sound and show continued economic recovery.
There are several buying opportunities which remain. Now is the time to pick up some of those companies which you didn't want to chase last year.
Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment for a portfoloio should be reviewed by your personal investment advisor.
No comments:
Post a Comment