Weekly Market Review

Stocks fell hard this week as more negative news came from across the pond. The fear that Greece is just the tip of the iceberg had yields on Italian, Spanish, and even French bonds soaring.

The fears led to the bulls selling and the bears re-establishing short positions. The S&P 500 fell by 3.8% and more importantly is back below the support zone I have been watching. The 1230 to 1250 area was resistance for two months before the breakout in October. In the month after the breakout the index was able to hold near the range, but the sell-off on Thursday was too much for the chart to handle.

The one bright spot is the 50-day moving average at 1207. If the index can bounce off the 1200 area it could be enough to spur a rally into the holiday. On the flip side, the news this weekend out of Europe has been shaky and thus we could see more fear selling into the long weekend.

For the most part we are looking to use the recent selling as an opportunity to buy into stocks and ETFs we feel are the best positioned for more upside into the end of the year.