Today: Market Analysis And Keys To The Trade
The markets are seeing red today. New worries are popping up over Europe and the debt crisis. This is causing the Dollar to spike higher and in response, the markets are falling. The SPDR S&P 500 ETF (NYSEARCA:SPY) is trading at $123.77, -2.26 (-1.79%).
The markets are holding a choppy pattern of consolidation. Overall, this still has a bullish tone to it on a macro scale. The choppy action saw a big down move last Thursday, then an up move Friday and down the markets go again today. The net move over the last week or so has been flat. This flat choppy action is the bullish consolidation that makes the macro pattern bullish. Should this pattern hold, upside will come later this week.
Bank stocks are leading the decline. This is normal when European worries drive markets lower. Bank of America Corp (NYSE:BAC) is trading at $5.42, -0.30 (-5.24%). The macro pattern on the financial stocks continues to be bullish even with the decline today. This confirms the S&P 500 macro bullish setup as well.
Commodities are also taking a big hit today. This is a result of a very strong Dollar. The PowerShares DB US Dollar Index Bullish (NYSEARCA:UUP) is trading at $22.36, +0.24 (+1.08%) . Commodities like oil, gold and silver are all plunging. The iShares Silver Trust (ETF) (NYSEARCA:SLV) is trading at $30.25, -1.08 (-3.45%).
While the markets look weak today, keep the emotion out of your thought process. Focus on the charts and they will lead you to the promised land of profit.