Inflationary Concerns – What’s New
June 5, 2006 · Print This Article
Big Ben let it be known today that Fed policymakers “will be vigilant” in battling the recent high readings in core inflation. He stated the economy was “in a period of transition” and alluded to the fact that rate hikes were inevitable if inflationary concerns persist.
Lynn Reaser, chief economist at Bank of America’s Investment Strategies group stated “he is sending a signal that further rate increases are likely to stem some of the upward drift in inflation.” She went on to say “Chairman Bernanke seems to be advocating a further rate hike as an insurance policy against rising inflation.”
As I stated last week I thought this market would test the lows established a few weeks ago and I think that is going to come to fruition. In my eyes this just presents another welcomed short-term opportuntity. If this market does indeed move into an oversold position I think our ETF strategy could possibly trigger a signal . The stars are moving closer and closer to alignment. This does not mean I think we are not going to move even lower after the initial pop off of what seems to be an area of strong support. Again, keep a close eye on the 200-day moving average of the S&P.
Daily Articles of Interest
RSI Wilder (5) for June 5, 2006
- SPY – 44.2 (neutral)
- DIA – 35.0 (neutral)
- QQQQ – 38.4 (neutral)
- IWM – 39.1 (neutral)
Comments