Tuesday, October 21, 2014

European Markets Bounce Back - Will Dow Follow Suit?

Today European markets are in a tearing hurry to regain lost position. There seems to be yule-tide spirit in European markets. This buying frenzy can be a misplaced sense of celebrations in Europe, since nothing much has changed overnight for European markets to cheer so much. Given that European Central Bank(ECB) has indicated Bond buying program to stimulate its economy, but is that such a positive for European markets? So far ECB President, Mario Draghi has promised much and delivered very little to European Union in his tenure of three years. Hence this indication of Bond buying by ECB needs to be taken with a pinch of salt.

That said, the good investor mood in Europe should rub off in US markets today. Yesterday Dow didn't do much to help the Bulls. Today we have another chance for Dow to touch its 200 DMA at 16588. The same conditions hold for movement of Dow as I had mentioned in my last blogpost.

Watch as the story unfolds today in US markets.

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