Greece continued with its talks over what type of Government it would like to have, but now Italy has come into the picture regarding its trillion dollar debt. Like Greece and every other European country Italy has spent too much money and is struggling to service its debt. It does appear every time there is a hitch to any European plan the markets take a dive. Today was no different as stocks slid to the lows by mid-day. Volume was lower showing institutions weren’t involved heavily in today’s move. A late day surge boosted stocks near the highs of the session. A bullish late day turn around keeps the market in the uptrend.
Europe is an absolute mess. Decades of social spending has finally caught up to the continent. It will catch up to the United States as well at some point, but for now the world’s focus is on Europe. In the end, price and volume matters and what we’ll focus on. Like we have said before, it is still fun to see the hoopla surrounding the grandstanding in the European Union.
Recent breakouts are still somewhat disappointing in the sense they are not running out of the gate. It isn’t a big problem at the moment, but is something we’ll keep an eye on. The red flags will come when these recent breakouts fall back below their proper pivot points. The important point here is we do have some leadership, but now we need these stocks to blast higher and take over. We could have a slow developing new uptrend like the NASDAQ in October of 2002. It wasn’t until March 2003 where the market was able to find its footing and explode higher. Anything is possible, but for now we are focused on our leaders and taking advantage of them.
Remember to always cut your losses and have a game plan to execute. Stay classy!
