and welcome back to Stock Charts R US blog.
The S&P depository receipts (SPY) is our proxy on the US stock market and really the broader US economy too. The recent 'double bottom' is significant because it suggests there is demand for US stocks as market participants believe there is some 'light at the end of the tunnel' with regard to the recent housing crisis. The 12 percent rally seen since the March lows (almost a text book 50% retracement of the down move!) is one part of the bottoming process. After the 'dead cat bounce' one ought to expect some sort of test of the double bottom itself. If the economy is turning the lows of the winter will hold. Watch for a test of the 130 area into June-July.
They don't say 'Sell in May and walk away' for nothing.
Brian Beamish FMA FCSI
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