NASDAQ struggling with a clean breakout
NASDAQ has managed to have four closes above the March near-term peak, but still not in a decisive manner, still less that 1%. The good news is that NASDAQ hasn't turned and run back down with its tail between its legs (as it almost tried to do on Tuesday, with a 50-point intraday decline.) But this is where we are, a classic "bull market climbing a wall of worry" and without any clear and compelling conviction.
Futures are up modestly this morning, suggesting a positive bias, but the question remains whether sidelined money will sell into any rally or buy on any dip.
The real test for NASDAQ now is whether or when it can manage a full 2% close above the March near-term peak, and to do it for at least two weeks to prove that it is sustainable. That would put us near or above the 4,450 level.
Iraq? Still a mess, but it always was a mess and always will be a mess, so that really isn't any actionable news.
We still have lingering ghosts from the bad winter, but they are just echoes now, not a preview of things to come. The stock market reacts to news on a daily basis, but longer term it moves based on expectations of where the economy will be in six to nine months. Some short-term speculators are actually react positively on any news of economic weakness which they figure will keep the Fed on a more accommodative stance for a longer period of time, since cheap money is gasoline for the engines of Wall Street.
I remain bullish and optimistic for the medium and longer term, but acknowledge the risks of the occasional pothole as the market slogs forward.
-- Jack Krupansky