The Daily Stock Report April 15, 2009

December 12th, 2009 | admin | forex educational

The market had a slight dip for 10 minutes this morning at the open and rebounded up. Many stocks had their buy entry on this reversal this morning and should resume this uptrend that has been going on for 2-4 months. The Dow30 was up 1.4% and the S&P 500 up 1.2%. The Asian markets were up sharply tonight at the open and sold off. As we go higher and higher, the market will tend to get more nervous and more news events may be treated as an excuse to sell.

These stocks that we are following still look “safe” to continue for a little while but keep your stops in with 5-7% trailing stops being suitable. For those who are approaching these long positions as swing trades it is likely we move up tomorrow at the open followed by some selling and this would be a logical point to sell stocks. It would be an important barrier if stock prices move to a higher high tomorrow and it could fuel the market higher.

Yet it is more likely that we have a brief positive opening, if any, considering that a report that American household foreclosures increased 24% in the first quarter. We also have housing starts, building permits and initial jobless claims. This is the hardest part of the market to make money, after a big run-up in stocks and they are tentative to make new highs. The risk is the highest, the odds are the lowest (same thing) and the rewards are the lowest yet people don’t want to be left out of the market if it becomes a runaway train upward.

Mutual fund managers can’t be left in cash when stocks are moving up, hedge funds trade the market both ways, and individuals start coming off the sidelines—all this can create a nervous twitchy market. So many people are close to the sell button. Oil index closed up 1.3% at $49.85 and the oil index continues to have slightly lower lows and lower highs.

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