Wednesday, November 30, 2011

Morning Market

Yesterday, the big news was the release of massive liquidity in a coordinated move by the central banks.  While I don't believe this was a positive development (more on that in the next post) the markets were obviously thrilled.  Prices moved through all three EMAs on decent volume.  Yesterday's fundamental event was what was required in order for the market to get out of its downward move (again, assuming the reason for the liquidity was solid).

The 5-mnute chart shows a massive gap higher, a sideways consolidation and then another move higher at the end of trading.

In contrast, we see money moving out of the treasure market, with prices gapping lower and then moving sideways. 

Despite the challenging fiscal environment, the municipal bond index is still in good shape.  Prices are near yearly highs.  The EMAs are all moving higher and the shorter EMAs are above the longer.  However, notice the arc of average is moving more and more sideways, indicating the upward momentum may be stalling.