The US and London stock markets are closed for a holiday on Monday. As of current posting, the German Dax Composite is trading flat and hugging the 50day MA, just like the three US stock indexes. Utmost on my mind is whether the financial sector will be leading the overall stock market higher or will it be bringing the markets down? While the financials looked cheap at this moment, that doesn't mean that it won't go lower. What's a recovery without the financials? The small bounce in the financial stocks might mean that it could be a "short the rally" on any move up to the overhead supply.
Personally, i felt that the banks might be stuck in a trading range as the other sectors come down to play catch up. Opinions are often wrong in the market so one should stay nimble and flexible as we await the breakout move. I am currently bearish on the markets.
Enjoy the holiday.
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