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Stealth Rally

October 15, 2010 – 5:32 pm

We had two pieces of economic news this morning that set the tone for the stock market early. One came from the Federal Reserve Bank of New York’s general economic index in the New York area. The reading came in at 17.7 the highest in four months and much higher than expected. Readings above zero means growth.

The second bit of news was retail sales which was up for September .6% following August’s sales up a revised .7%. That is a revision higher,not lower. That number too was better than expected.

This is further evidence of economic growth. It is not stellar growth but certainly indicating a better economic outlook. Add to that the stronger than expected earnings reports that many companies are releasing and the result is a stealth rally.

That is a rally that does not feel like a rally, a rally few people believe in and many avoid. As long as fear is prevalent it will likely continue. Of course a weak dollar has helped greatly as well.

Good Trading
Steve Peasley

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