Wall Street was giddy on Thursday after hearing Europe’s long-awaited plan to fix their debt crisis is finally gaining traction. We covered the details of the 3-step plan yesterday and economic news here at home was decent with 3Q GDP (Gross Domestic Product) coming in better-than-expected. Jobless claims were a smudge over 400,000 again but were mostly in-line with expectations. Throw in some short-covering and it was off to the races for the bulls.
The Dow advanced 340 points, or 2.9% to settle at 12,208. We mentioned a run to 12,200 was possible if the bulls broke 12K and we can’t call it much better than that. The index traded to a high of 12,284 before giving back a little of the fluff, but more importantly, the blue-chips closed above their 200-day Moving Average (MA) for the first time since the beginning of August. We started our homework a little early because the Dow hit our top-end target a day sooner than expected but the signs are pointing towards a test up to 12,500-12,600 if the bulls can keep the momentum going.
The S&P 500 soared 43 points, or 3.4%, to finish at 1,284. Coming into the week, we knew there was a good chance of 1,250 falling and we said a break above this level could lead to run up to 1,275-1,300. The index hit a high of 1,292 and also conquered its 200-day MA.
As for the Nasdaq, it zoomed 88 points, or 3.3%, to end at 2,738. Tech hit an intraday peak of 2,753 and we said to look for a pop to 2,700-2,750 this week.
We are going to be a little short with our commentary because we have a Special Notice inside our Members Area along with 2 more NEW TRADES!!! We closed out 3 winning trades this week and locked-in half profits on 2 others.
We normally don’t like buying options on Friday’s but one of our latest recommendations is a Drug company on the verge of doing BIG things if they gain approval of one of their drugs. The other trade we are recommending options on is a stock that could gain 50% by year-end if it makes it back to its 52-week high by Christmas.
Subscribers, pay close attention to the LIMIT PRICES we have set for each trade. If we can’t get in at the open, we will wait and see what happens. If we do get filled, we will send out a Trade Update shortly after the bell.