Courtesy of Blain.
Friday’s surge on more European creative bandaging is a legitimate reason to start putting some capital to work and support the new potential uptrend but we cannot forget Europe is still a mess and is nowhere near a recovery.
Short term, ie the next 3 to 5 sessions after the holiday break, seeing Friday’s gap range remain intact would be big for bulls. If this is tested on the downside we risk a reversal right back down to where we started. If it holds up then this market could very well cruise higher into mid July.
The market is being driven on purely stimulus and bailout hopes, and fresh hopes means fresh market action. However, as more is baked into the market, the risk for a big surprise the other way (ie Germany leaving the EU or anything non Greek related) grows. Thus, caution should continue to be noted and smart, scaled buying with conservative stops is worth its weight in gold.
If you are looking for stocks to consider, check out my most recent 50 great stocks to watch, lots of great names in there.
Tomorrow is a half session with Wednesday the 4th being a closed market. Market recaps will resume on Thursday the 5th. Have a great 4th and see you back here later this week!