Stocks Take a Breather Despite Strong Rally From Apple
February 13th, 4:29 pm by Lior Alkalay
(eToro Blog) US markets consolidated but continue to assist trend following Openbook traders who have a long US equity bias. Guru trader Maximus24876 continued to fight the tape selling the Dow Industrials on Thursday ahead of the ECB and BoE meetings. Returns for this portfolio manager have been rocky during the past few months, as picking a top in riskier assets has proven to be a difficult task. Maximus24876 trades approximately 14% of his portfolio in US equity, and has had a hard time generating returns as US equities have been a one way train during 2012.
Maximus24876 is not the only bear trading on Openbook. Guru traders are expressing their opinions through a new section called Guru Talk which can be found off a tab on the main page of the eToro blog. Trader Atelieruk reviewed a paper in which super stock strategist Tom Hougaard discusses the potential for the Dow to fall below 5000.
Petra09, among the most active of the US equity index traders on Openbook, continues to ride the wave higher, notching up gains during the week as equity bourses grind higher. In addition to solid gains on US indexes, Petra09 made over 22% during the week on a long position in the DAX.
Europe regained the spotlight toward the end of the week, creating headwinds for the US equity markets. After announcing an austerity agreement on Thursday, US traders woke to news that EU Finance Ministers in Brussels told the Greek Finance Minister that an additional 325 million Euros in cuts would be need to receive a second aid package. The skepticism over the agreement was warranted Thursday, as the US indexes failed to rally on the news.
Apple stock price continue to drive the Nasdaq during the week as the stock pushed to new all time highs reaching for $500 dollar per share. Technically, the Nasdaq continues to surge higher, and an increase in volume is confirming the uptrend. The RSI on the Nasdaq is moving into a concerning overbought level above 80, which is the first time the RSI has moved above the 70 level during the past 6 months. Support on the technology index is seen near the 10-day moving average at 2507. Resistance is seen near weekly highs near 2800.
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