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Wednesday, June 29, 2011

Market Thought... normalcy

Looks like the 'expectations' post was pretty good. Greece voted in the austerity, and the SP500 closed above the 28/32 SMAs.

IMO, the market is now transitioning to make these the support for a positive trend.  We may see some follow through, but the 62SMA should be resistance.  The market seems a bit spent here, after the last few rallying days, and we may have to wait for earnings to act as the fuel. (Unless the jobless claims tomorrow are kick-ass, or the macro economic data provides the fuel. Reversing the 'top-down' debbie-downers.)

About a month ago I highlighted the major systemic threats that could derail the market in my 'no boom-boom?' post.  For the time being, investors have a sense of normalcy from the various systemic-events that place fear in the market. The only real uncertainty left, at least until Europe festers again, is the US debt ceiling. (Even though Europe is festering, I think very real progress is being made and the structural/productivity improvements, that should have happened years ago, will make Europe a very interesting place for investors and make the Euro a legitimate global currency.)

The action in the 10yr also suggest the biased is now toward the equity markets again.

Obviously it is in a negative trend, but the action is encouraging toward a shift in attitude.

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