After a bullish close Friday, the market today was rattled by worries surrounding Italy’s own debt problems coming to light.
If fresh drama continues to unfold in Europe that does not primarily have to do with Greece, then this market could very quickly sour. On the other hand, the market is shunning aside any US issues at the moment so if this Italy drama blows over then bulls are still in full control.
The overwhelming view at the moment is that we are seeing a natural pull back after a huge run-up, and the direction will quickly move back upwards. While most often the general consensus is proven wrong, unless Italy’s woes turn into something bigger, investors should expect this market to move back higher in time.
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Long-Term | Up | Up | Up |
| Intermediate | Up | Up | Up |
| Short-term | Up | Up | Up |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
*** I’m simply using the indices’ relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.
