The Nasdaq (pictured below) successfully bounced off its support at 1600. Another positive note is that the 50 day moving which has been descending since June of last year has turned and it’s currently trending upward. Going forward if the market continues to go higher the 50 day moving average should act as support for the market if it is healthy. Other major indices showed similar attributes. The leading sectors today and recently have been materials, energy, builders and some select technology.
Allgen Financial Services, Inc. has been picking up some commodity stocks over the last couple of weeks, and most recently we started getting into a major infrastructure builder. A lot of the stocks in these areas are trading at an extreme value and should benefit from the Obama stimulus package.
The Nasdaq broke above it’s resistance of 1600. This is something it has failed to do four times in the last two months. It also broke above its descending 50-day moving average. Although the breakout was on low volume, it should bode well for the technical condition of the market. Other major indices also followed suit. Treasuries sold off today which is good indicator that investors are starting to take more risk. The clear leaders were commodities, energy and technology all of which were down significantly last year.
Allgen has been selling out of some bonds recently in order to reallocate back into the stocks.
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