Well, Thursday was a peculiar day. It started off nice and red, but, as usual, thanks to Fed intervention, everything shifted green. In this instance, the kabuki player they shoved in front of a microphone was Fed President John Williams (NYSE:WMB). So whereas the day started off weak due to real information (lackluster earnings), it ended the day strong thanks to bluster (the vapid utterances from Williams’ lips). Whatever works, right?
I wanted to point out the minor crossroads the market is at currently, by way of the Dow Jones Composite. Here are the past couple of years. We were at the highest point in human history just a couple of trading sessions ago, and it wouldn’t take much to set another record high. The key is whether we can cross over 9051.98:
What’s especially interesting about this chart is revealed when you look closer. This actually gives the bulls something to cheer about, because look what happened with the weakness on Wednesday as well as Thursday morning. All that transpired was that the Dow Composite eased back to its horizontal breakout of 8907.93. Indeed, the low for the day on Thursday was merely 0.04 points above that level (!!!) which is as clean and successful a test of the breakout as you can imagine.
Thus, the market is poised for more strength, unless that price gap is broken. So those are the two levels to watch: 8907.93 on the bottom and 9051.98 on the top.