The previously reported breach of the upper end of the 'panic' bear chanel that was recently reported may have been a little haste. New confusion with regard to what are now being called 'legacy' assets by the big banks and an anticipation of poor earnings, have brought the recent rally into question. It seems ironic when one looks at the chart above and sees that the recent optimism hasn't even broken the most recently trading sell signal, go figure.
Considering too the upcoming cliche.....'sell in May and walk away', one shouldn't be too surprised if we indeed do have to take a pause here. Consider too the January Barometer and one also is left with the feeling that the market may have to move to the downside in the not too distant future. Lets hope I am wrong and we do indeed have a further upleg to go as we head into May...
As has been the case for some time, investors still have no reason to be invested in the S&P 500 (and US stocks in general). Weekly Traders should be short the US market from the indicated points and Daily traders should be very selectively long. While I do personally remain long a number of issues as we head into the anticipated seasonal peak in May (mostly in Venture Cap issues related to the metals markets), make no mistake, I plan to liquidate these short term trades soon, especially if I start seeing M tops...
That's all for this week,
Brian Beamish FCSI
the_rational_investor@yahoo.com
the-rational-investor.com
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