Dow Up Again!
August 30th, 2007 NW Teong
The Dow was indeed very volatile for the past few days. As I mentioned in my blog yesterday, this is like riding a roller coastal. If you cannot take this type of ride, it is better for you to wait and monitor at the side line. For those fun (risk) seekers, this is an exciting time.
As I also mentioned in yesterday blog that “The markets are clearly telling the Fed to cut rates sooner rather than later”, investors rushed back in and bought up the shares and hence boosted the Dow yesterday precisely due to this expectation of an interest rate cut.
However, there are still sometimes before the next FOMC meeting on 18 Sept. Anything can still happen before this date. In short, market will remain volatile. Of course, Fed can always cut the interest rates before the stated date for FOMC meeting if situation worsen at a faster speed.
Technically, after the surge yesterday, Dow is once again near the top of its down trend line. This means that it is likely to come back down again in a day or two, if there is a rise, the upside will be limited. At its current level of 13,289, it is still yet to cross its 50-day SMA of 13,450. This is a fairly strong resistance for it to cross at the moment. Cheers!
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