Tuesday, June 21, 2011

Stocks Rally In Europe Ahead of Greek Vote

I just lost my entire post on Blogger. Very frustrating.

Markets on higher this morning on improved sentiment from foreign markets. The Greek PM has an important confidence vote later today, but the markets are signaling they think that the vote will be successful.

Asian markets rose nicely overnight, while European markets are higher across the board this morning, led by a 4% spike in Greece's market.

The dollar is lower this morning against a basket of currencies. That is helping boost commodities, with oil prices higher near $93.80 and gold prices up to $1547.

Higher commodity prices are spurring rallies in the energy and materials sectors, which are leading the markets by a wide margin. Defensive consumer staples stocks are lagging.

The 10-year yield is higher at the 3.00% level. Yesterday I showed the negative reversal in the VIX and said it pointed to lower prices. We are seeing that today, as the VIX is plunging more than -10% back down below the 18 level.

Trading comment: The market has now rallied more than 2% since I penned my article on bearish investor sentiment. We are making some sales into today's rally, to raise cash and stay defensive. Although this rally feels good so far, the market is still in a defensive position as long as the SPX remains below its 50-day moving average, which is now downward sloping.

Growth stocks today are really shining. Take a look at: APKT, ARUN, RVBD, LULU, ACOM, FTNT, EZCH, BODY, JOBS, etc.



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