Stocks Log Gains In February

Byinfo@50park.com
SPX- Another Positive Month On Wall Street
SPX- Another Positive Month On Wall Street

Wednesday, February 29, 2012
Stock Market Commentary:

Stocks and a slew of other risk assets rallied in February which helped Wall Street enjoy another positive month. From our point of view, the major averages confirmed their latest rally attempt on Tuesday 1.3.12 which was Day 9 of their current rally attempt. Since then, stocks have been enjoying a very strong uptrend. The benchmark S&P 500 jumped above its 2011 high and hit the highest level since 2008! The bulls remain in control of this market as long as the benchmark S&P 500 stays above its 50 DMA line. Leadership continues to improve which is another healthy sign.

ECB’s LTRO 2 and Q4 2011 GDP Top Estimates:

Stocks opened higher on Wednesday after the Q4 GDP and the ECB’s second LTRO program topped estimates. 800 European banks borrowed 529.5 billion euros ($713 billion) which topped the Street’s estimate of 500 billion euros.  In the U.S., the latest Q4 GDP estimate rose to 3% from the initial estimate of 2.8%. This was the largest gain since the second quarter of 2010 and beat Q3’s 1.8% reading. Bernanke testified on Capital Hill and largely reiterated his recent stance regarding the ongoing economic recovery (with downside risk) and inflation remains in largely inline with his forecasts. Elsewhere, gold and silver both got smacked which bodes poorly for other risk-on assets.

Market Outlook- Confirmed Rally

Risk assets (stocks, FX, and commodities) have been acting better since the latter half of December and are extended by any normal measure. At this point, all this means is that the odds for a pullback increase. However, markets can very easily go from overbought to extremely overbought so trade accordingly. As always, keep your losses small and never argue with the tape. If you are looking for specific help navigating this market, feel free to contact us for more information. That’s what we are here for!
 

Similar Posts

  • Stocks End Mixed After Hitting Fresh 2010 Lows!

    Byinfo@50park.com

    From our vantage point, the latest three day rally failed, evidenced by the ominous action in the major averages since Friday’s jobs report was released. It is well known that a market should not be considered “healthy” unless it trades above its rising 200-day moving average (DMA) line. The fact that all the major averages are below both their 50 & 200 DMA lines bodes poorly for the near term. That said, the bears will likely remain in control until the popular averages close above their important moving averages and the euro catches a bid.

  • Stocks Quiet After ADP Report

    Byinfo@50park.com

    Market Action- Rally Under Pressure; Week 27
    It was encouraging to see the bulls show up and defend the major averages’ respective 50 DMA lines in November, January, and late February. From our point of view, the market remains in rally-mode until those levels are breached. The tech-heavy Nasdaq composite and small-cap Russell 2000 indexes continue to lead evidenced by their shallow correction and strong recovery. However, it is important to note that stocks were a bit extended in recent months and this pullback (back to the 50 DMA lines) is very healthy as it shakes out the weaker hands and restores the the longer term health of this bull market. If you are looking for specific high ranked ideas, please contact us for more information.
    Are You Looking For Someone To Manage Your Money?
    Our Private Wealth Management Services Can Help You!

  • Market In A Correction; 50 DMA Line Broken

    Byinfo@50park.com

    Market Outlook- Market In A Correction
    From our point of view, the market is in a correction as a new downtrend has formed and the 50 DMA line is broken for many of the major averages. Since the beginning of May, we have urged caution as the major averages and a host of commodities began selling off. Looking forward, the next level of support is the 9-month upward trendline and the next level of resistance is their 2011 highs. If you are looking for specific help navigating this market, please contact us for more information.
    Want Better Results?
    You Need Better Ideas!
    We Know Markets!
    Learn How Our Consulting Services Can Help You!

  • Stocks End Week Higher

    Byinfo@50park.com

    Looking at the market, since the March 1, follow-through-day (FTD) the market and a batch of leading stocks steadily rallied. The fact that we have not seen any serious distribution days since the FTD bodes well for this nascent rally. It is also a welcome sign to see the market continue to improve as investors digest the latest round of stronger than expected economic and earnings data.Remember that now that a new rally has been confirmed, the window is open to start buying high quality breakouts. Trade accordingly.