LAST WEEK & THIS WEEK

First, the last week:

The US stocks „late-day rally” gives Nasdaq weekly gain and flat the week for SP500. S&P500 rose Friday 0.4% and ended roughly flat for week.

Weekly US performances:

• Dow up 0.3% Friday, down nearly 0.6% for week
• Nasdaq jumped 0.5% Friday, up 0.5% for week
• SP500 up 0.4% Friday, down 0.03% for week

Friday US stocks traded in negative territory for most of the session and in the last two hours jumped higher. As the old rule says the first 1-2 hours represent “emotional buying,” driven by greed and fear of the crowd, the smart money typically waits until the end of the day, which finally lifted up the market.

After last Thursday huge sell off, the market made a modest gain Friday and that was a good „buy the dip” opportunity for the braves and smarts. The smart guys aren’t necessarily panicking at small sell-offs like this.

This market pattern seems easy. Each time when stocks decline, buyers arrive and start to buy the low levels and the dips. That works like a life saving net for Mr. Market against any bigger correction.

This week:

We noted last week the Russell 2000 is at 10% correction, but this not the end of the world, as we stated we add more and bought the dip, because it is cheap and good bargain now. We have the similar view about SP 500 either. We bought the dip Friday and expecting rebounce back to 1.900 level maybe this week. The market will get back to bullish track again that is our short time expectation.

The BFM Assets Team.