# Markets Put Gloom And Doom Behind Them



## InTheMoneyStocks (18 March 2011)

The markets shot higher today as the U.S. Dollar got crushed. As of today, the panic and fear from yesterday is ancient history. As long as no new major catastrophes are unfolding, the markets are taking a breather and bouncing. The SPDR S&P 500 ETF (NYSE:SPY) is trading at $127.87, +1.69 (+1.34%).

Yesterday, there were major signals that the market would get a bounce today. These signals are common when a market makes a short term bottom. The first signal was the negation of all the 2011 gains and the major gap fill from December 31st, 2010. As the SPY shot lower, it went to $125.75. This happened to be the closing price on the last trading day of 2010. With the massive flush yesterday, the markets negated all the gains for 2011. In addition, yesterday saw massive volume. Not just big mind you, but massive. This is known as capitulation volume where the weak hands give up, dumping their positions. When the retail investors sell, the bottom is in. The climax of fear plus increased volume showed a bottom was most likely in the markets for the short term. The up move today confirms it.

In addition the the signals of a short term bottom, the Dollar is a major key to the markets rise.  The Dollar is in major break down mode.  The PowerShares DB US Dollar Index Bullish (NYSE:UUP) is trading at $21.83, -0.18 (-0.82%). The major support on the UUP was $21.90.  Over the past couple years this level has held. However, today it has been broken. This could be the start of a major new move lower on the U.S. Dollar. A weaker Dollar is usually good for stocks.

Gareth Soloway
InTheMoneyStocks


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