Higher and Higher we go

Hi there, and welcome back to CRI's S&P 500 blog.

For the better part of 5 months now, the US stock market has been booming higher. Those regular readers will of course clearly remember CRI's overt bullishness coming out of the US mid-term congressional elections last fall. Along with a fundamental shift away from Federal anti-business government, the US Fed. reserve board also promised a substantial injection of capital into the market in the form of $600 billion of new 2 to 5 year bond purchases. This program, known as QE2 literally guaranteed a floor in equity prices and indeed, the market responded accordingly.

Technically, both investors and trades ought to be long from the considerable breakouts last fall. Investors will recall our time tested indicator (the relationship between the 13 EMA and the 30 SMA) crossed bullishly in October. At the same time, a nice double bottom was registered at about the same level. Since that original entry, investors are advised to sit on the long side and be long. Traders have been given yet another entry signal. when prices crossed back above 122.31. Currently those traders have their stops just under recent support at 116.97. Short term support appears to be in and around the breakout high (122.31) and the 6 EMA (125.09).


Enjoy the rally and be sure to take some profits along the way. What to find out what CRI is trading now? Go to CRI's OnlyDoubles NewTrades to see what CRI is buying right now. What to see what CRI is taking profits on? Go to CRI's OnlyDoubles Profit Blog to see how recent purchases have paid off...

That's all for this week,

Brian Beamish FCSI

The Canadian Rational Investor

the_rational_investor@yahoo.com

the-rational-investor.com