By Gareth Soloway on May 10th, 2010 11:46am Eastern Time
If you can't fix it, print some more money. That is the policy of the world leaders today as Europe has in place an almost one-trillion bailout package of sorts. After last weeks market decline, this is not surprising. Bottom line is, if you can't fix it, print it.
Stocks continue to hold most of their gains today. The DOW, S&P 500 and NASDAQ all up 4%. Key moves from stocks like Apple Inc. (NASDAQ:AAPL), Google Inc. (NASDAQ:GOOG), Exxon Mobil Corporation (NYSE:XOM) and JPMorgan Chase & Co. (NYSE:JPM) all keeping the markets up in a major way. Oil is surging today, after key technical levels were hit on Friday and gold is pulling back with the fear trade subsiding.
As every country prints money, the markets get a solid bounce in the short term. However, the problems down the line get even more scary and ominous. It puts the world on a course that most of us shudder to think about and makes me as a Chief Market Strategist believe the huge M-A pattern on the monthly chart of the S&P 500, will play out.
On Friday, I talked to my subscribers about the likely possibility of European leaders doing something drastic to try and stabilize and prop up the markets. In tune with that, I had a short term positive bias on oil, negative on the U.S. Dollar. In addition, while I told them it was an extremely risky bet based on the current volatility, the markets were likely to see a bounce early in the week. Every call I made was correct. How did I understand this? Simply put, technical levels on the charts. Hundreds of charts were at master technical support levels. In addition, understanding the nature of the beast was key. There was no way Europe or the United States would stand by and allow the markets to continue to collapse. Doing so would have gone right in the face of what Ben Bernanke and President Obama have done for the last year and a half. Understand it, learn it and profit by it!
Gareth Soloway
Chief Market Strategist
InTheMoneyStocks.com
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