Investors Influenced by More Than Government Budget Talks

The mild sell-off in Asia reflected Wall Street’s pessimism Monday after a disappointing report on U.S. manufacturing. The Dow Jones industrial average finished down 10.75 points, its seventh consecutive decline. The Dow began the day up more than 140 points before falling by as many as 145.

Here. That’s not all. The stock markets have other headwinds blowing against further rises. One, the major indexes have formed a head-and-shoulders technical pattern that started in February of this year.  This pattern is used to forecast turning points in the direction of financial markets.  Note the emphasis on forecast, aka, a prediction of future earnings.  Also working against the stock market is the season of the year.  Spring and summer are typically not bullish months.  The saying “sell in May and go away” was coined to describe this phenomena.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s