Posts Tagged ‘Uptrend’
Market in UPTREND, June 1st
I indicated in my last post on May 24th that the market action that triggered my models into a downtrend was also action that we sometimes see near bottoms in the market. This turned out to be one of those times. The market has proved to be strong since then, breaking through its 50 day moving average and yesterday spiking up in significantly higher volume. This turned enough of my indicators to buy signals to indicate that we are now in a new UPTREND.
But as there were some cautionary signs to the downside last week, so there are in this uptrend. We typically like to see higher percentage gains in the indexes than we did yesterday. Another cautionary factor is that we are now in a third year bull market, and market action typically tend to be choppy with modest gains in such years.
Monitor leading stock for further indication to the strength of this new uptrend.
The strong market action yesterday was set off by indications that a new plan to save Greece was near. The market has chosen to party, at least now in the short-term. And I hope investors enjoy it while it lasts because I am certain (to the degree that anyone can be certain about anything regarding the financial markets and government action for that matter) that helping out Greece will do nothing else than cover over the cracks of the underlying structural problems which in due course will implode and cause even greater harm further down the road. I am confident that neither Greece, Portugal nor Spain will not be able to recover its debt ridden economies without going through debt defaults on a grand scale first, which will have severe global implications.
But for now, lets enjoy this last uptrend which is likely to take the markets above recent highs.
Market in UPTREND, March 30
We entered a downtrend on March 10th, but we have had enough positive market action over the last week to finally shift the market into a new uptrend yesterday Tuesday March 29th. The market shook off downbeat headlines yesterday as consumer confidence (data from the Conference Board) fell more than expected, hurt by higher food and fuel prices and concerns about the job market. The Conference Board’s chief economist said that this “will likely impact spending decisions.” What is important is not what economists like her are saying but rather what the market is saying, and the market is now saying (through my models) that it is in an uptrend. Act by it until we enter a new downtrend again. But use caution despite the new uptrend. Buy only the top stocks in the best industry groups as close as possible to proper buy points. Control your exposure by scaling into positions as a stock moves in your favor.
The Case-Shiller home price index was another data point that turned in its worst one-month performance in a year. The 20-city gauge fell 3.1% between January and February. “The housing market recession is not yet over,” the head of the committee at S&P said. Just wanted to remind you that the fundamentals still do not look good for the housing market.
Newsletter #10 – Market in Uptrend
A pretty short addition this time, but it does contain some extremely important information like:
- More (dark?) omens have been observed in the market over the past week
- There is always something we can learn from history – a small study of the crash of 1987 and 2008
