This past week we had the Dow Jones Industrial Average swing 1,000 points to close up 1.80% over a 5 day period. That was for certain an intense week for the markets and most people with money in the markets. I expect volatility to remain within this range as long as we have global risks to Sovereign Nations and domestic U.S. political risk. However, that does not mean you should stay out of the market, with heightened volatility comes inefficient markets and that brings a lot of opportunity.
We took advantage this week of what we thought to be an aberration in the Italian yields that surged past 7%. We will certainly find out if the Italian yields were a one time phenomenon or not sooner than later it the new Prime Minister fails stem structural change.
In addition, we told our Forbes readers and our members we were looking to get long pre market Tuesday that morning at the 1230 to 1236 region. The chart represents our S&P 500 trade.
Last week, we wanted to wait for a dip to enter the market preferably at the 1188 to 1204 region. Unfortunately, the market traded to only 1210.00, and we never entered the market. Last week we told our members and readers that we were concerned in the short term about European contagion. (See this article) We told members at this point to sell any rally on the back of Italian Prime Minister Berlusoni’s resignation. As we are aware, the S&P rallied to 1277 before selling off to 1228 on the S&P. We remain flat and look to re-enter the market with little more consolidation in our target range we have identified for a year end rally.
Below are high growth momentum names that we have been monitoring. Their Beta obviously tends to be high and investing in these names are not for the faint of heart. Below each chart is a recommended action. For Our FREE S&P 500 News Letter Visit www.thechartlab.com
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