Short Term Outlook

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Went looking for more info on that prediction for a recession by ECRI's Lakshtun Achuthan. This was his latest on Nov 7 saying we are in one: http://articles.businessinsider.com/2011-11-07/markets/30368531_1_recession-bullishness-stew

This is a story four days later saying he does not know what he's talking about: http://articles.businessinsider.com/2011-11-11/markets/30386057_1_indicators-recessions-ecri

Can't find anything more recent on the validity or lack thereof of his prediction/assertion.
 
Today, we all get at least 2 more trades for the month. So, the question is, when do we use them. The Nasdaq is over the 50 and 200 dma but has opened up 2 gaps as the premarket has set the tone. I'm not an expert on gap fills but it seems we need to test those areas. The S&P is nearing resistance levels and I don't see a good line of support exept maybe 1225 again and the 50 dma at about 1205.

So, if we are diving in to the Santa rally, we need a point of reference to get out if we are wrong. Depends on your risk tolerance. Mine is not too high as I am now retired so I will be looking for a pull back and a bounce or a clear breakout to the upside.
 
I feel like this rally is going to fizzle soon. We are back at 200 dma and at down trend lines from recent tops. Of course, if we do break out (above 1290) we will have more room to run. Euphoria over Italy and Europe will disappoint again I'm afraid.
 
We are right at the October highs for all indicies. This will be a crucial test for the market. S&P failed at 200 dma yesterday. Can it bust through? Sentiment sure has gotten positive as indicated in stock prices and our survey. Maybe Europe will help us out but it could be a sell the news event. I'm still looking for that clear breakout.
 
Show-me said:
I'm feeling fizzle/pull back then end of year rally.
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Me too, but I worry that's the sentiment of far too many people. I wouldn't be surprised if we get another unexpected rocket ship up at any moment...of course, with so much uncertainty on the macro scale I worry that rocket could crash and burn on take-off...which brings me right back to square one. It's a viscous cycle :nuts:
 
Today, thinks seem better in the markets. We've had a few days to consolidate and we now have a swing low made at 1253 according to Ira Epstein which would be a good sell point on the way down. A close above 1264 or so would put us above the 200 dma and above what looks like a cup and handle or inverse head and shoulder pattern. So, I'm leaning toward a buy in the market but let's see how today turns out. The Nasdaq NDX is about to have a golden cross where 50dma crosses above tge 200 dma.

Europe is scary. It could go either way.
 
I wonder what the first days of Jan will bring. Some years we have big drops the first few days. We are going to have a big move soon as the charts are in a triangle pattern and have to resolve those soon because it is running out of space. Perhaps this is the time we will break out to the upside.
 
clester said:
I wonder what the first days of Jan will bring. Some years we have big drops the first few days. We are going to have a big move soon as the charts are in a triangle pattern and have to resolve those soon because it is running out of space. Perhaps this is the time we will break out to the upside.
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That would be a nice start to 2012.
 
clester said:
Is this the resolution? Nice day shaping up. Will it last? The first few days of Jan have not been a good tell of the year lately. Anyway the uptrend looks intact.
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Nice close and a clear breakout above 200 dma. Uptrend looking good. Lots of unbelievers should help this rally continue. S fund not looking as good as C fund though.
 
clester said:
Nice close and a clear breakout above 200 dma. Uptrend looking good. Lots of unbelievers should help this rally continue. S fund not looking as good as C fund though.
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Reveiwing the charts over several time frames for the 3 stock funds, it is clear that the C fund is the outperformer. I looked at 1,3,6, and one year comparisons. Not sure what that means for the stock market but the S fund is now out of favor and C fund should be the main fund to watch and use until that changes.

I think the market is in a general uptrend and I think we should look to buy the dips. Europe is still an issue but those downturns caused by them could be buying opportunities. Of course, this is just IMHO but my gut says we go higher but I am biased as I am in the market. :)
 
If you listen to the talking heads, you would sell stocks and run to bonds. They are still focused on the negatives. Europe etc.

They can't see te positives or they talk down the positives. I think they are wrong to do that. The cloud is lifting. Of course Europe is still a problem but I think the world is buying American. I think we can make a run for 1350. The market is reacting different now. Less volatility which is good for stocks and we are in an uptrend. Of course, I'm watching the 50 and 200 dma. If we go below, that's a problem.
 
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