Stocks Rally As USD Falls

Monday, December 13, 2010
Stock Market Commentary:

Stocks rallied as the USD fell and China said it will hold rates steady even though inflation is accelerating. Market internals remain healthy, evidenced by an advancing advance/decline line and an expanding number of stocks reaching new 52-week highs.

China’s Central Bank Holds Rates Steady:

China’s central bank decided to hold rates steady even though inflation accelerated to the fastest rate in more than two years. The Chinese central bank held its benchmark interest rate unchanged which helped a slew of stocks and commodities rally. The move also helped allay concerns that the world’s fastest growing major economy will slow down which would adversely affect the global recovery. The US Fed is slated to hold its last meeting of the year on Tuesday. The market believes the meeting will largely be a non-event as most of the news has already been announced.

Market Action- Market In Confirmed Rally Week 16

It is encouraging to see the bulls show up and defend the 50 DMA lines for the major averages. The market remains in a confirmed rally 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. Put simply, stocks are strong. Trade accordingly. 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!

Sarhan Wealth Management provides both global macro and equity only consulting services to high net worth and institutional clients around the world. For years, our clientele has participated in the firm’s objective market-based outlook, which has one primary goal: to provide robust trading ideas across all asset classes. Since 2004 we have outperformed the S&P 500 on a regular basis. These results are based solely on our weekly research. All our historical data is available upon request.
How we can improve your performance:

  • Achieve better results in the market by working with an objective third party.
  • Provide you with sound buy/sell ideas in real-time.
  • Provide objective feedback on your investment ideas and market outlook.
  • Contribute profitable ideas to your investment committee (if applicable).
  • All investment ideas are fully transparent, unbiased, and based on market action, not opinions.
  • Help create uniformed structure within your organization.

Contact Us To Learn How We Can Help You!

Similar Posts

  • Day 1 Of A New Rally Attempt

    Wednesday marked Day 1 of a new rally attempt which means that the earliest a possible follow-through day (FTD) could emerge will be Monday. However, if at anytime, Wednesday’s lows are breached then the day count will be reset. The technical action in the major averages and the latest round of economic data bodes poorly for the market and the global recovery. Currently, resistance for the the major averages are their 50 DMA lines, then their longer term 200 DMA lines while support remains July’s lows. It is also disconcerting to see the action in several leading stocks remain questionable as evidenced by the dearth of high-ranked leaders breaking out of sound bases. Monday’s negatively reversal coupled with Tuesday’s ugly distribution day effectively ended the latest rally attempt. This emphasizes the importance of remaining cautious until the rally is back in a confirmed uptrend. Put simply, we can expect this sideways/choppy action to continue until the market breaks out above resistance or below support. The first scenario will have bullish ramifications while the second will be clearly bearish. Trade accordingly.

  • Stocks End Week Higher

    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.

  • Investors Digest A Slew Of Economic Data

    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.

  • Week-In-Review: Stocks End Flat After Support Was Defended

    Stocks End Flat After Support Was Defended It was another volatile week on Wall Street as investors digested a slew of economic and earnings data. Apple was the big standout winner last week as the stock shot up to new highs after reporting earnings and legendary investor Warren Buffet announced he was increasing his position…

  • Strong Week On Wall Street!

    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.
    Want Better Results?
    You Need Better Ideas!
    We Know Markets!
    Learn How We Can Help You!

  • A Clear Downtrend Has Formed

    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 the 50 DMA line and then the 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!

Leave a Reply

Your email address will not be published. Required fields are marked *