Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
After yesterday’s positive action, which helped a lot technically on many sector and index charts, we are seeing a follow through move today as it appears the President is going to have trouble getting Congressional support for a strike in Syria and some recent economic data from China is helping.
- President Obama said on Monday that he was uncertain whether he will win the Congressional vote to authorize military action, and was undecided whether he would order a strike without Congress’s support.
Overnight, China reported industrial output rose 10.4% on the year. Asian markets were very strong yesterday as well with both Japan and China up in the 3% range. China has been really moving of late as the economic data seems to be improving – the Shanghai index had given up ALL gains from the 2009 rally!
As for U.S. indices, as mentioned yesterday the NASDAQ was already in good shape but both the S&P 500 and small cap oriented Russell 2000 pushed over their respective 50 day moving averages and had bullish MACD crossovers (see bottom of each chart). This is positive on an intermediate term time frame. Shorter term – this has the makings of one of those V shaped moves and after today’s 2nd consecutive gap up, things will be very heated in the short run and a bit overbought.
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