Analysis:
Today the market exhibited the classic pattern of a short-term top, as it opened higher and stayed elevated throughout the day, but only to close flat. Commodity markets do not bode well for the Bulls, either. Crude oil failed to break the key $90 resistance, while gold price action formed a double-top pattern. Euro's rally into $1.34 was apparently sold into by the Bears to finish above $1.32. Looking ahead to tomorrow, the driver of the market will be the failure of the European finance ministers to reach an agreement to comprehensively deal with Portuguese and Spanish debts. As a result, the sinking Euro along with the rising T-note rate will drag down the market to below 1,217.
Strategy:
Hold short at 1,217
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