Yesterday Germany and France could not agree on a thing. Seems the rumor today is that they agree on the basic points and a plan could be in the works. REALLY? Gee, we've never heard that before! Or have we...........? In reality, only a select few know the truth. Yet Europe is up this morning on the rumors as the PIIGS exclaim "Yea, we'll all be saved"! In the meantime there are protests in Greece, the Middle East, and yes, even America with Occupy Wall Street appearing in cities across the USA.
And yet nothing really seems to transpire. The leaders of the world seem impotent. The politicians ignorant of the chaos. No actual resolution happening in Europe, Mideast dictatorships watch in ignorance as surrounding dictatorships topple, unemployment is still at an all time high while US politicians keep screaming and shouting but offer no action-no solutions. And the media thinks Occupy Wall Street is just a cute little gathering of people. Really? REALLY?
It all seems to scream "Let Them Eat Cake"!
Meanwhile the charts are just chugging along, consolidating at the top of the channel, with lower highs each day. Above is the "top of the channel" resistance and the 100 day SMA (orange). The market seems to be struggling, working, waiting for the moment it will beak out to the upside. Will the catalyst be a European solution? Even the 20 SMA (green line) is trying to move up thru the 50 SMA (white line). Another bullish indicator trying to form. Yet while the odds seems to favor an upside breakout, until a it occurs in this news driven market, anything is possible. To avoid false breakouts (see candles 8/31 and 9/1) it's usually best to wait until the market has a close over the resistance line with good volume and a strong pace. And the downside possibility still lingers. So tread lightly and keep your powder dry.
Everything is sideways.
CURRENT MARKET TRENDS
Long Term (Weekly Chart) – Sideways (Trading Channel)
Medium Term (3 day chart) – Sideways (Trading Channel)
Short Term (Daily Chart) – Sideways at the top of the channel
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