On Friday the Dow traded above 13,000 for the first time since May. Though round numbers are typically dismissed as more of a psychological milestone, that may not be the case this time.Right now the market is trading on psychology as much as anything else. Is the price action a sign that psychology is changing - that bulls are off to the races?Trader Joe Terranova thinks it is.
Terranova, who is chief market strategist for Virtus, says price is truth and what he sees in the market is a series of higher lows – a bullish pattern.And he adds, “On Tuesday almost everyone said Apple’s weak earnings report would break the back of the market – but it didn’t. ““When a market stops going down despite a flood of bad economic news – and lackluster earnings reports, that says to me position for a rally. We’re going higher. Money managers are about to chase the market higher.”Trader Steve Grasso,director of institutional sales trading at Stuart Frankel, isn’t quite as positive. He believes the current rally was triggered by ECB president Mario Draghi who said earlier in the week that the ECB will do whatever it takes to save the euro.Page 1 of 4 | Next Page