Another day where the market doesn’t want to stay in the red! This despite a first in weeks, (‘worse than expected’ U.S eco’ data), as dips continue to be bought up. Support is being found at last week’s highs/ breakout levels as shorts have nothing (catalysts) to press lower on. As noted to begin the week, ” The early morning dips were bought this week indicating selling is not robust at all, either.”. This can be repeated for this week/ today.
A question entering the week,”… We’ll see if perceptions towards sovereign fears continue to abate following ECB easing ways.”. Today, we had peripheral auctions go off without a hitch and ECB conference passed without a whimper, so you can definitely say the fears continued to abate as no bombs or even firecrackers went off in the Eurozone during a loaded calendar week.
“Market is about the QE (LTRO etc.) going on in Europe, not…” We need to remain cognizant of the Eurozone headlines, but it shouldn’t be the deal breaker in making a trading decision, right now’, Jan 5. This belief (LTRO= QE = working) has been gaining real traction as the week progressed.
The same premises/ themes outlined this month remain intact heading into a long weekend. A breather is probably good for some market sectors as well, but with earnings gearing up, we can turn attention to more single stocks without worrying if the market and some sectors feel extended.