Bernanke Bounce

I have mentioned over the past few days how the market was primed for a bounce. Well, my service established a position (call options) mid-day yesterday in the tech heavy QQQQ and was rewarded handsomely today. Our proprietary signals worked to perfection. We had to wait several months for a signal, but it was well worth the wait. As I always say patience, patience, patience. Many investors forget this concept and stray away from the long-term course and usually suffer the consequences as a result.  We have yet to close out the position as there still seems to be more room to run in this current market environment. We do anticipate a possible struggle to move substantially higher over the next few days, but if we can consolidate here and move slightly higher or stay flat over the interim then we should expect to see another spike higher over the next week or so. The market left us with some amazing bullish technical indicators for the intermediate-term so the move today certainly has the possibility to gain some legs. The next few days should give us a decent indication whether or not the move today was a fakeout or the beginning of a sustainable move higher. I certainly hope it is the latter.

As I stated yesterday, there are still many uncertainties to overcome (geopolitical, earnings reports and guidance, etc.) over the short-term, but if we can get through the next few days with a slightly bullish bias we should expect to see a continuation of today’s rally. Until tomorrow. Have a great night!

 Daily Articles of Interest

• Is a Necessity, Not a Luxury

• : Inflation under control

 RSI Wilder (5) for July 19, 2006

• SPY – 44.6 (neutral)
• DIA – 58.7 (neutral)
• QQQQ – 44.6 (neutral)
• IWM – 57.0 (neutral)