The Week Ahead: A Market Rebound?
March 18th, 2007 by Grant in: InvestingThe ball is in the Fed’s court again this week as the debate on interest rates rages on. Most are expecting the Fed to leave rates unchanged, and data is coming forth that housing may be on the upswing.
However, homebuilder’s confidence may not be so strong. They are continuing to see the number of existing home sales fall, which means that there is still little liquidity in the housing market. You can’t blame them for being timid, after a sour taste of a bear market, you’d hesitate to be bullish too!
Wednesday the central bank will announce a decision on what to do with overnight lending rates. It is anticipated that the bank will leave the rates at 5.25%.
Out of all of these catalysts for the market this week, it appears that things are starting to stabilize, which if that should hold true, should be comforting for us individual bottom of the food chain investors.
As for my GLD shares, I still have them, and I’m encouraged by a $0.63 increase in share price last Friday. It appears that Gold should start to focus on the declining dollar, which makes the upcoming inflationary data all more pertinent to my investment.
Here’s to a green week on this Saint Patrick’s Day weekend!
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March 18th, 2007 at 10:05 am
What about the Yen carry trade?
March 18th, 2007 at 5:57 pm
Path of least resistance is still to the downside, upside for the Yen. June Yen opened strong tonight and is trading .0029 higher, June S&P trading down 3.25 points. Volume was dry on equities’ short rebound last week, not a good sign. Options volatility starting to pick up, should be a fun week!!
March 18th, 2007 at 8:27 pm
maybe a good week to be short?
March 18th, 2007 at 8:37 pm
Thanks for checking in, Winston. I’m still looking at Gold to be the hedge against the US dollar, and I think the yen carry trade fiasco may be winding down such that Gold will start to follow the dollar more closely. Could be wrong though.
Paul, I’m not sure I’d be overly short this week. There is a lot of data coming into the market that could send equities in either direction. If you don’t like to watch the minute by minute stuff, a money market account would be a safe bet for this week.
-Grant