Friday, July 16, 2010

July Mini Rally, with Low Trading Volume

On the heels of positive earnings reports from Alcoa and CSX, kicking off the new earnings season, the markets are up for the 6th consecutive day, around 6%. Traditionally, as reported in a prior post, July is a good rally month for the markets. I would call this a mini-rally because of the uncertainty going forward.

Technically, all the major indexes are overbought - stiff resistance is ahead as the price levels near the 20, 50 and 200 day moving averages. Also, the rally is on lower than average volume, which shows a lack of conviction. Still, if earnings continue on an upbeat note, we should expect the rally to follow suit, barring any major new negative
economic news.


C. Cohn
Cohn-Reilly Report / News Flash

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