Yesterday the Bulls had complete control. The dip buyers proved that they are neither sleeping nor on vacation -- not quietly going away. Stocks were bid from the open, and after the Fed announcement the market moved higher, although closing under the highs of the day. But the major indices were more than 1 percent higher after two consecutive down days -- and recent churning action, of course, has allowed the S&P500 to at least work off some of the overbought conditions.
As we all know, the trend is your friend until it is not. And the trend so far remains as it has been – with the Bulls.
But the Bulls should not get cocky. The economic problems have, unfortunately, not all gone away.
We will continue to look for charts, making small moves and taking profits along the way. We believe that this is not a time to be jumping into the market with both feet, trusting whatever the talking heads on tv say. It seems a time to study charts, make small moves where charts look right – and continue to take some profits to be prepared for another day.
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