The follow through on the market direction today is what investors needed to see to confirm the trend back up. While there is always the possibility of further issues stemming from the Crimea situation, Putin’s comments about the Ukraine in general has investors back buying again despite an emergency meeting by the G-7 being arranged by President Obama. As well Fed Chairman Yellen will be speaking shortly and investors anticipate the Fed will remain largely accommodative.
Market Direction Chart Intraday
Today’s market direction shows the S&P is well on its way back to challenge the all-time highs. In a stepping stone pattern the S&P this morning is seeing every dip bought and a new step added as the S&P works its way back to above 1870. The market looks well on its way to establishing a close at or above 1870 for the day.
Dow Index Intraday Market Direction
The same pattern is not evident in the Dow but often it is because it primarily represents just 30 stocks. The jump in the morning to the intraday high above 16360 while nice would have been better if the intraday showed a general stepping pattern, because that pattern is what builds strength in both momentum and investor confidence. However after the big morning run-up the Dow still managed to hold steadily above 16320 which brought in more buyers.
IWM Index Intraday Market Direction
The other index well worth watching is the Russell 2000, IWM ETF. It shows the similar pattern as the S&P 500 with the dips being bought and the ETF climbing to each new step. This move higher in the IWM ETF would indicate that it too will probably break through its previous high sometime this week.
Market Direction Outlook Into The Close For March 18 2014
Several times in my market direction outlook’s I have indicated that it is important not to buy into the bear outlook. Instead it is better to remain cautious but invested and look for opportunities and take them as they come. You can always take profits as a stock you are following moves higher or the options you have sold decline in value allowing you to close for profits. A lot of investors have still not recovered from the shock of the 2008 to 2009 bear market and you can tell that neither have many analysts, media pundits and websites as well as magazines and newspapers. But with proper strategies that allow investors to profit in any market environment as well as protect long-term positions, we are better able to weather the constant doom and gloom that seems to follow stocks.
The markets are set to close higher for the day. Tomorrow may see some selling but without a catalyst to the downside, I will be looking for additional opportunities in any selling that might happen tomorrow after two big up days.