They don’t want to get caught up in the euphoria around better-than-expected Black Friday sales and a possible bailout of Italy.
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New York, NY (PRWEB) December 02, 2011
Following the worst Thanksgiving week performance for the market since 1932, traders actually made money, according to popular e-newsletter Profit Confidential. Black Friday sales came in higher than expected and rumors that the International Monetary Fund (IMF) was about to give Italy a 600-billion euro loan caused a strong move up Monday in the markets.
According to Michael Lombardi, lead contributor to Profit Confidential, “Plain and simple, we’re looking at a classic short-covering rally today.” With the Dow Jones Industrial Average having fallen 7.9% in 11 trading sessions, Lombardi believes that short sellers have made enough money and are taking profits.
Writing in Profit Confidential, Lombardi states “They don’t want to get caught up in the euphoria around better-than-expected Black Friday sales and a possible bailout of Italy.”
Italian newspaper La Stampa reported this weekend that the IMF was preparing a 600-billion e uro loan for Italy in the event its situation worsens. On Monday, the IMF denied the report.
“Forget the rumors,” writes Lombardi, “A child can see that, since August, the Dow Jones Industrial Average has been stuck in a trading range of 10,500 on the downside and 12,250 on the upside.”
Profit Confidential has highlighted that traders have been buying stocks when the Dow Jones Industrial Average goes under 11,000 and shorting shorts when the Dow Jones Industrial Average goes over 12,000.
“Traders have been making a lot of money trading this bandwidth,” says Lombardi.
But once in a while traders get caught on the wrong side of the market, Lombardi goes on to say, “Today’s a perfect example of short sellers being on the wrong side, quickly covering their positions, and sending the Dow Jones Industrial Average higher.”
Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it “begged” its readers to get out of the housing market...before it plunged.
Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.
To see the full article and to learn more about Profit Confidential, visit http://www.profitconfidential.com.
Profit Confidential is Lombardi Publishing Corporation’s free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit http://www.profitconfidential.com.
Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi’s current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.
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