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As the markets have fallen sharply this past week, some stocks are nailing massive support levels and may see a short lived bounce next week. These plays may be optimal swing trades and great for capturing gains in a short amount of time.
The first stock nailing a major level is Goldman Sachs Group, Inc. (NYSE:GS). After being downgraded yesterday, the stock has tumbled into the $140.00 level. This represents a massive support level and should signal a bounce early next week. To get more information and trade alerts to buy and sell Goldman Sachs, take the seven day free trial to the Research Center.
The second stock hitting support is Morgan Stanley (NYSE:MS). This is another financial firm that has been under pressure almost all of 2011. While the stock has tumbled from a high in 2011 of $31.04, it now is slamming into major support at $24.25. Look for a bounce early next week. The money is waiting to be made, learn how to swing trade stocks like Morgan Stanley. Make hundreds of times more money swing trading than investing. Even a simpleton can do it. Take the one week free trial to the Research Centernow.
Lastly, Yahoo! Inc. (NASDAQ:YHOO) has hit a level that may represent the best bounce of all. This stock is down sharply today after major miscommunications surfaced between Alibaba. With such confusion, the stock is getting pounded, down -1.17 (-6.81%) t0 $16.00. This level happens to be a major pivot low from mid March as well as the 200 moving average on the daily chart. A easy $0.50 bounce is likely next week and maybe more. Take the seven day free trial to the Research Center and make money like the pros. Click here.
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com
The Federal Reserve has wanted a weak Dollar policy since this crisis began. In fact, even far before that. The weaker the Dollar the higher exports. Trade balances adjust and overall it is a more even playing field for the United States when it comes to selling and buying goods. In addition, more recently the Federal Reserve found that they could manipulate the stock market by pushing the Dollar lower. Ben Bernanke has fought long and hard to put into effect his thesis paper from way back in the day. This thesis basically said, to create a recovery, the powers that be must make people believe there is a recovery, then it will happen. Essentially fooling the average American. While in theory this may be something to like, reality happens to have consequences.
While dropping the Dollar and pumping trillions of Dollars into the economy helped in the short term, the questions remain whether or not the recovery will last. In addition, as commodity prices surge, the average American struggles to pay for food and energy, has a weaker Dollar really helped? In addition, is the weak Dollar policy, which is forcing the markets higher, really helping? In reality, a higher stock market and weaker Dollar helps those who invest heavily. The richer Americans do not care much if food and energy costs go higher as they can afford it. In addition, as long as they are invested, the weaker Dollar drives up equity prices, thus offsetting the rising cost of good for them. How do you combat the Dollar and the markets action? Take the seven day free trial to the Research Center. Click here.
On the other hand, the poorer Americans are getting the short end of the stick. Not only do they not have significant investments, or even any investments but the rising costs of food and energy of creating a catastrophe. Bottom line is this. Who is this policy really helping? Is it just another way to enlarge the gap between rich and poor? What is better? A weaker Dollar for exports and the market or a stronger Dollar for the average American?
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com
Since the middle of last year, the Federal Reserve has created about $500 billion worth of cash reserves. This is insane when you think about it. Money created out of thin air so that the stock markets can be propped higher. There is no question that the Federal Reserve will try and kill the U.S. Dollar again sometime down the road. That seems to be Ben Bernanke's way of keeping the economy afloat. You see, the last time the Federal Reserve let the dollar trade was in the first half of 2010. At that time the dollar surged higher from November 2009 to June 2010. This dollar rally caused the stock markets to have their first severe correction. Then Ben Bernanke, pulled out the QE-2 ($600 billion U.S. Treasury purchasing program) and the major stock indexes started to soar right back up. What ever happened to supply and demand? Trading and investing for the long term now simply depends on the amount of money the Federal Reserve will create.
The problem that the Federal Reserve ran into recently was that commodities such as gasoline, and food prices have just become too expensive. People that know very little about economics are demanding that prices for things people need such as gasoline, and food, need to come down as they are no longer affordable.
Recently, Ben Bernanke, said that commodities were higher due to supply and demand. What planet is this guy living on? This is planet Earth, not planet Fed. What is this guy thinking? Doesn't he know that a falling dollar, the world's reserve currency, will lead to inflated prices for goods that people need to survive? Of course he knows, however, now he is trapped. Therefore, he will now allow the dollar to bounce a little and have these prices deflate before he drops the dollar again in order to inflate the markets back up. It has been a game of yo-yo for the Fed. When the U.S. Dollar goes down the major stock markets go up and vice versa. We can only wonder, how long will this game last?
