Wednesday, October 14, 2009
Back To The...Dow 10k
The euro broke out of 1.485 level that I had been talking of and the dollar index is making new lows under 76 as commodities in turn, get bid up aggressively. Oil now looks like it is breaking out and should see 80 dollars shortly. Eventually I would not be surprised to see crude up between 85-90 by the end of year. So I guess fill up your tanks now. And buy oil service stocks of course. Copper also is making a push towards $3/lb which is the top part of a sideways channel that has been in place since early summer. If copper breaks out the market could be telling us the fear of inflation is back or the economic growth is returning. Or both.
Still plenty of earnings to come this week and next that should guide the market in the short term. Overall, I remain a bull until I am not one. Which just means the market will tell you when it exhausts itself of buying. A high volume capitulation of euphoria has not occurred yet and I think you should remain bullish until that momo dies off.