Stock Investing : A Bear Market Rally Says Technical Analyst
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New York, 23 Apr. From the depths of depression in early March, stock traders have been jubilant since, racking up over 27 per cent gains on the Dow Jones Industrial Average and even bigger up ticks in Emerging Markets.
New York, 23 Apr. From the depths of depression in early March, stock traders have been jubilant since, racking up over 27 per cent gains on the Dow Jones Industrial Average and even bigger up ticks in Emerging Markets.
Everyone has been asking if we have defined a long term market bottom, and whether the current rally can be sustained. We have turned to Alpha Bravo 99, a long term markets technical analyst for answers, and his views are published exclusively below.
US markets have been forming a bottom for a while now after the waterfall crash in late 2008.
The weekly charts for the DOW and the SP500 indexes have recently turned bullish and this rally could last sometime but we need to be aware that the longer term charts are still trending down and are very bearish.
Global long term charts have been bearish since late 2007.
Any rally that we may have will be a ‘bear market rally’ which is an uptrend contained within a much larger downtrend.
Long term charts will always influence smaller time frames ie. daily and weekly global charts are bullish now but the big picture chart outlook remains bearish.
That said, a bear market rally in the US and elsewhere could last several months or even a year – we don’t know yet.
All we have to do is follow the trend and get off when it finishes.
Please note that the ‘ Buy and Hold for the long term ‘ mantra espoused by many stockbrokers and financial advisors will no longer work as the multi decade bull market is over and finished.
A MAJOR bear market started in late 2007 and it may last for decades – who knows – and investors need to be more nimble these days or they will lose money.
If you would like more information, please contact alpha.bravo99 [at] gmail [dot] com. Note: Alpha Bravo 99 first announced this viewpoint on the 11 April 2009.
