A strong rise on the Dow Industrials +1.39% and a similar rise on the SP500 +1.34% and Transports +1.4%. The Russell2000 was a more anaemic +0.46%. We need to see more strength than that in the small caps to believe that this rise is sustainable.Europe. London +1.75%, France +2.43%, Germany +2.2%.
The Ozzie Dollar was smacked again -1.44% and marginally below major support at about 0.98. A strong Ozzie is needed to sustain advances in the stock market. Today's weakness is not encouraging.
Looking at the chart of the Dow Industrials - today was an "inside" day. That's neither bullish or bearish. None of the major indicators broke above their down trend lines. Follow-through buying is needed to believe that today's action is starting to reverse the bearish action of the past month. And I'd like to see some relative strength returning to the small caps.
How is Japan going to fund the reconstruction of their devastated country? It is already one of the most indebted countries in the world (debt-to-GDP ratio 200%). A sobering analysis is provided in an article at Safehaven (see blog-roll) entitled Japanese Fallout May Hit Treasuries. Such bearish articles inevitably appear when pessimism rules - but the analysis is worth keeping in mind.
Here's a link:
Good luck
Red
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