MPT Rating (02 Weak Bear)

9. July 2008 by admin.

Wednesday, July 9th, 2008; MPT Rating (02 Weak Bear) 

So IRAN makes money selling Oil, and after a few days of major Oil selling in the overall markets, IRAN decides to test fire a missile and boost their net worth; oops, Oil closed near unchanged for the day – I guess IRAN is not as threatening as they would like to think.

The DJIA lost 236 points today and it did absolutely nothing…  Today’s activity, or should I say the activity of the past few days, shows what is called a “kicking pattern” and it is common at peaks and bottoms as the market trades sideways before a trend shift.  This is nothing to get excited about unless you are looking for an opportunity to buy more quality stocks on the cheap before the rally starts.  Yes, I do not see a drop off of a cliff into the unknown abyss here, rather a sell off in Oil which will be increased by a strengthening dollar once the FED starts to raise rates, and to top it all off I anticipate second quarter earnings to be great simply because the FED had the rates lowered so much that most businesses will have seen an increase in their profit margins for the reported quarter.

The NASDAQ lost more than 59 points for the day and could go lower tomorrow, but it is again pointed out that with all 3 major averages pressing on the heavily oversold 30 line of the RSI Indicator, what goes down is likely to quickly reverse course soon as the markets can not sustain these short-term oversold conditions.

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 (02).  This MPT (02) reading is the weakest bear indicator we have, and this typically mean early morning selling met by a bounce higher as the MPT Rating will begin showing base signals, followed by “Smart Money” buying.

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

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