MPT Rating (00 Base)

2. July 2008 by admin.

Wednesday, July 2nd, 2008; MPT Rating (00 Base) 

The markets lost points today, but little of any thing really happened…

The oversold conditions of the DJIA are undeniable and can not remain at these levels long…  The DJIA lost 168 points for the day, but the selling is unjustified here – there will be a bounce soon as the RSI indicator for the DJIA clearly points to being heavily oversold at 21.61, I think today’s activity in the market has more to do with the anticipation of the upcoming long weekend ahead.

The NASDAQ gave back all of yesterday’s gains and closed down 53 points, but as I have repeatedly stated here; I see the NASDAQ as having room for further selling and today’s activity there is no surprise.  Having said that, I would like to make one thing perfectly clear, this market is in a pullback, but not a bear market which would require us to be shorting now or exiting the market, in fact this is where investors should be buying quality stocks at heavily oversold prices before the second quarter earnings season starts…  remember, the worst sector in the market now is the financials, but with the FED rates where they are the financials are going to see higher profit margins for their second quarter and that sector will not be dragging on the markets.

Today’s MPT (Market Power Trend) Rating, which tells us what “Smart Money” is doing in the market today and what to expect with the overall market tomorrow, came in at (00).  This MPT Rating is the natural trend direction cared over from yesterday’s MPT Rating of (01) and it is again confirming a bottom support is located at this level in the market.  Without more bearish news to fuel the fire I believe the bears have run their short-term course and I would be looking for the bulls to step in next week after the long holiday…

As always I recommend investors and traders, be smart, patient, and ever successful.

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