We hold LightPath Technologies (LPTH) starting at $1.40-$1.60 in January 2017 and suggest long-term ...
Can this bounce pass the technical test over the next few days?
06/27/2013 3:33 pm EST
U.S. stocks have taken back about half the ground they lost in the June tumble after moves up this week, but the market now faces a series of technical tests. For the bounce to turn into something with a somewhat longer life, it’s going to have to show the ability to move through resistance levels over the last trading session of June and into the first sessions of July.
Resistance levels are thick on the ground here. At 1607-1608 the Standard & Poor’s 500 marked a 50% retrace of the June slide. The early June closing low was at 1608.9. The 20-day and 50-day moving average for the index is at 1620.
U.S. stocks have moved up today to 1613.09 on the S&P 500 as of 3:30 p.m. New York time. That’s a good sign since yesterday the index had stalled at 1606.59, just south of resistance at 1607, before closing at 1603.
The major impetus today has been a full-court press by members of the Federal Reserve arguing that the market had over-reacted to Fed Chairman Ben Bernanke’s remarks on a potential schedule for beginning to taper off the Fed’s program of buying $85 billion in Treasuries and mortgage-backed assets a month. Today’s speeches pulled out the big gun with New York Fed head and Fed vice-chairman William Dudley joining the crowd along with Atlanta Fed head Dennis Lockhart and Fed governor Jerome Powell
The only worrisome sign so far today is that market advance has been on below average trading volume. It would make me feel more confident that this move upward was more than a bounce and more than end of the quarter window dressing if rising stock prices were drawing more traders and investors into the market.
Right now I’m hopeful but certainly reserving judgment on the nature of this move--until next week anyway. (Although the Fourth of July holiday will make next week hard to read too.)
Related Articles on STOCKS
The best corporate managers are always one step ahead. Salesforce is the second coming of Amazon.com...
Now about new highs being celebrated, amidst deterioration of a slew of internals: This suggests nei...
Our daily breakout stock ideas are most suitable for aggressive investors seeking ideal entry points...