A week ago I wrote about the nice technical setup for the bulls. The indices were short-term oversold and were trying to bounce at a point that would make a higher-low. Well that bounce was successful enough to propel the indices to new 11-month highs today. The indices are now in short-term overbought territory and bumping up against the tops of some trend channels (the channel is much clearer on the Nasdaq). I wouldn't be a seller here but I'd prefer to be a buyer closer to the bottoms of those channels. I think this is "hold 'em if you've got 'em" territory.
All the short term trends flipped back to "up" a couple of days ago...
| Trend | Nasdaq | S&P 500 | Russell 2000 |
|---|---|---|---|
| Long-Term | Up | Up | Up |
| Intermediate | Up | Up | Up |
| Short-term | Up | Up | Up |
(+) Indicates an upward reclassification today
(-) Indicates a downward reclassification today
Lat Indicates a Lateral trend
*** I'm simply using the indices' relations to their 200, 50 and 10-day moving averages to tell me the long, intermediate and short-term trends, respectively.
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Regards,
Jayson
What is really strange about this bull run since early July and the commentary approving of it is the expectation that it will continue through 2010 as the news and analyst estimate will tend to be "better than expected." The market has risen 18.6% in two months, so to expect it to keep rising in the high teens every two months is absurd (outside of mid 1999-early 2000). If it did the S&P would rise to 2910 by this time next year.
Moreover, the bulls who say we'll reach 1150-1200 shortly, don't say "What then?" It reaches that point and plateaus or continues ever higher?