Wednesday, June 22, 2011

Consolidation would be nice

An impressive show by the bulls yesterday ensured that the market finished with gains for four consecutive days. The action yesterday also meant that the market made higher lows for the first time in over a couple of weeks. Interestingly, the S&P finished just short of MA(20) level.

What next? Call me crazy, but I would rather see a day or two of consolidation here rather than another big move up. Its been four consecutive positive days for the bulls and some consolidation right over here, just below the MA(20), would increase the odds of staying over the MA(20) once they break it. Expect the downtrend line marked in the above chart to act as support.

I will be back with few charts for the watchlist.

Take care and good luck!

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