Prevailing
Comment S&P600 - April 29, 2008 - As stated the past several days, the configuration
mentioned on Thursday, April 10, 2008 remains the most discerning at
this point. This index remains well above the bullish red curve. You will
notice a light blue line drawn across the yellow curve. At some future
point, the red curve will intersect with that tangential line. When that
happens the current bullish cycle will expire. Yellow’s inflection is the
first indicator of the bull tiring. That does not mean the bull is about
nap, but the rate of increase should slow down. There is plenty of room
before red contact with tangential. Therefore, fear of bear should be
minimal at this point.It is
obvious this S&P600 will not fall below April 10 or April 11 values in a
few days. However, the probability remains high that that will happen at
some future point. That probability will adjust depending on when red
interacts with tangential. If it does not occur this year, a deep 2009
bear would not be out of line.
As pointed out the past few days, the
yellow curve inflecting back to the north without the index falling below
yellow will offer bullish sustainability for several more weeks. There are
early indications this is occurring.
As stated since last Tuesday, April
29, 2008, although
there is currently a 97% probability the S&P600 will be lower at some
future point than it was on April 11, 2008, the normal Quick-term Indicant
has developed too many bullish attributes to continue avoidance tactics.
Prices last Tuesday, April 29, 2008, were back to approximately where most were sold after
the 20-months of holding from August 2006 through January 2008.
Consequently, there were several ETF buy signals on Tuesday, April 29.
Solid bullish behavior occurred the next day, April 30. The Quick-term
Indicant will not be slow in generating sell signals until the heart and
soul of bearish seasonality starts in late August through early October of
this year. There should be at least one, if not two bearish cycles before
then.
