This Stock Market Hours Report is brought to you by Jason Ng, Founder, Master ‘O’ Equity

One more week has passed and the Dow has traded largely sideways still while the weekly 30 MA moves yet another step nearer. From the established long term bull trend and the price resilience over the past few weeks, I would say a rebound is highly possible when the weekly 30MA moves nearer to the weekly candles. There isn’t going to be much releases to look forward to this week that will move the market significantly except for the crude inventory numbers. Crude oil prices have been rallying since June and still looks to be very strong. A sustained rally in crude oil prices would put pressure on production prices and the stock market as a whole. So far, the Dow doesn’t seem to be greatly affected by it and the Nasdaq composite has taken a boost from it. How it will lead on to is certainly hard to predict in the face of such resilience.

Thought For The Day : “Every Morning Marks A Brand New Beginning”

This Stock Market Hours Report is brought to you by Jason Ng, Founder, Master ‘O’ Equity

FUNDAMENTAL ANALYSIS
Stocks staged an encouraging rally today as the Dow closed up 126.81 points. A renewed wave of investor confidence flooded the market as bond yields begin to drop, mergers begin to pick up and the ISM index beat analysis estimates. The ISM index for June turned in at 56.0 with estimates at 55.0, which is the highest in 14 months! What does this mean? This means that the US Economy is expanding at the quickest pace in 14 months! A reading above 50 denotes an expanding economy and a reading below 50 denotes a contracting economy. Sound economic fundamentals are always the pillars of stock market expansion. To this point, I remain optimistic, for now.

TECHNICAL ANALYSIS
The Dow established a floor for the sideways channel today with its rebound. It now seems obvious that the Dow might trade within a 13250 - 13700 channel until the weekly 30MA line catches up before a real, sustained rally can happen. However, this is not to say that it will not start to do so now. Now that we have the channel floor and ceiling established, a break above the ceiling on strong volume can be deemed as a breakout and the start of a rally.

The Star Trading System seems to pick up on this optimism today with a growing number of morning stars.
Thought For The Day : “Rules Are The Chains Within Which One’s Emotions Must Be Contained”