16 January 2021
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Inside Markets

Switzer Daily
22 June 2009

This will be a testing week for this rally, which has seen the market indices put on back-to-back weekly rises. This is significant as it’s the first time this has happened since May 2008!

That said, Wall Street did put in a negative day before the weekend.

The Dow Jones lost 122 points or 1.65% to 7,278.
The Nasdaq lost 26 points or 1.7% to 1,457.
The S&P 500 dropped 15 points or 2% to 768.

The question remains: Is this a bear market rally or the start of a bull market? The consensus says it’s a bear market rally, but it could go for some time. Economist Clifford Bennett from Kinetic Securities thinks it’s the start of the bull market and has rung the bell on the day that kicked off the 11% jump in the Dow Jones index.

My chartist mate, Lance Lai, says his charts point to another sell off. Of course profit-taking is only natural when the consensus is not firmly in the bull market camp. This is why we’re in testing waters over the next few weeks.

A big market mover early this week will be the details from Treasury Secretary, Tim Geithner, about the banks’ toxic assets plan. If the news adds certainty, investors will react positively and vice versa.

Have a good day,


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