Dow’s March Low Breached But Bulls Getting Ready
There is not a lot different from what I wrote two days ago. Stocks continue to digest, pullback or whatever else you want to call this current pattern of behavior. The only difference on Thursday morning is the one of the major stock market indices, the Dow 30, breached its March low as IBM’s poor revenue number took the stock down almost $10.
The S&P 500 is hanging in, but the S&P 400, Russell 2000 and NASDAQ 100 are all quietly performing much better. The longer this behavior continues, the more bullish it is. Many of the shorter-term indicators I watch, like the TRIN and sentiment surveys are approaching oversold levels within a bull market. That’s typically a recipe for strong returns going forward over the ensuing 3, 6 and 9 months.
While the pullback continues, the bears need to really step up their game sooner than later if they have any chance at further weakness. If not, I believe the bulls will ready their charge before the end of the month and move the stock market to all-time highs later this quarter.
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