Holding the 50
From Deron Wagner this morning:
We concluded yesterday’s newsletter by saying, “As long as the 50-day MAs hold up, and we don’t see a session of higher volume selling, both the short and intermediate-term trends remain up.” The Dow, Russell 2000, and S&P Midcap 400 indices all dipped below their 50-day MAs on an intraday basis, but recovered to close above them. The relatively strong Nasdaq Composite did not even dip to touch its 50-day MA yesterday. The potential for higher volume losses was definitely a concern throughout much of yesterday’s session, but the late-day buying spree solved that problem. So, overall, we have no choice but to conclude the bulls are still in control for both the short and intermediate-term. Nevertheless, we would now like to see the broad market consolidate its recent gains for a few weeks, while leading stocks and sectors continue to move higher. A solid base of consolidation would provide stocks with a springboard from which to start another leg up, without moving up too far, too fast.
I think Deron’s ‘intermediate’ term is shorter than my intermediate term…
BMB would also like to see some of that consolidation, thinking that we’ve already come too far, too fast.
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