Raise Cash Levels

Struthers Resource Stock Report (02/06/2010)
This could be a key turning point for the short term. In my update earlier in the week, I stated that we were destined to test support around 1030. The S&P 500 hit 1044 Friday and bounced back, which is close enough to be a test of this support zone. More importantly the chart formed very closely a doji cross or a hammer. IF and I purposely used a 'big if' the market gaps up on the open Monday it would form a strong reversal pattern called a 'morning doji star'.




The Dow formed a better doji cross and the same applies. Another thing I watch is the 30 and 60 day moving averages, if they cross it often signals a change in trend or direction. So far the 30 day MA has not crossed the 60 day MA so the uptrend is still in place. However, I do expect it will cross over in time. The market would have to rally above the 60 day MA to prevent this. The first resistance level on the upside is around 1110. This rally if it does indeed get started will we be a good opportunity to raise cash levels if you have not done so already. I have been suggesting 30% to 40% cash level for months now and this recent correction only gives you a little taste of what I expect to come about later this year.

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