Unconvinced of the rally – Market Analysis for week beginning 07/03/2010 by Singaporeseeds

The market staged a big rally on Friday when the unemployment numbers were surprisingly good. The S&P also broke its trendline and hit the monthly pivot resistance. If it breaks this resistance, we might be going up for a while more. We had been in an uptrend with decreasing volume over the past month. We are still in a bullish trend on weekly charts.

S&P daily charts with RSI


However, RSI is saying that either we are at the end of this uptrend, or we are at the initial stage of an even bigger rally. Knowing me, I’ll stick with the end of the uptrend analysis. But seeing the momentum of the market on Friday, we will need to go sideways for a few days before we can see any real sentiment turn in the markets. We will have to see how the market goes over the next days before we can get a clearer picture.