Future Looks Bleak For The Stock Market
Posted on Thursday, February 19th, 2009 | In Investing Lessons, Trading LessonsYesterday’s action in the stock market did not inspire much confidence. While the DJIA finished positive, buyers were not rushing into the market to buy stocks. Rather, it was a half-hearted attempt to keep the DJIA above the November low.
The DJIA finished just 3+ points above the November low. It is difficult to imagine that the bears will not try again to push below 7552. As for the S and P 500, while it has some room to run before testing its low, it is important to note that it is currently below the 61% Fibonacci Retracement, meaning it will likely continue downward.
One positive sign is that the McClellan Oscillator is reaching oversold territory at 70.41. But as I have said time and again, oscillators can stay oversold for long periods of time.
The market action over the past year demonstrates why buy and hold does not work. It was a great idea when the market was in bull mode almost twenty years, beginning in 1982. Clearly, that bull market is over. That is not to say a bull market may spring up at some point, but it may be a long time before any of us see Dow 14000 again. Now is the time to either be short or stay in cash.
Last 5 posts by Kingsley Anderson
- Stock Market Continues To Heal - February 15th, 2009
- Not A Lot To Be Excited About - February 12th, 2009
- Will The Stock Market Rally Continue? - February 9th, 2009
- Oil Range Tightens - February 9th, 2009
- Dow Almost Gives It all Back - February 4th, 2009
 About Kingsley Anderson (http://tradethebreakout.blogspot.com)
Kingsley Anderson is a long-time individual trader. When not analyzing stocks, he is an attorney at a large law firm. Prior to entering private practice, he served as a judge advocate in the U.S. Army for five years and continues to serve in the U.S. Army Reserves. Kingsley primarily relies on technical analysis to decipher the markets. |
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