Bias to Upside
April 25th, 2008 by Buck Woodford
After gapping up at the open, the market sold off mid-morning on rumors of US Navy contractors firing on Iranian gunboats (story was later refuted). As of the lunch hour, we’re back to flatline.
I remain in a bullish mindset for two reasons. First and foremost, there are lots of great looking individual stock charts available — far more than anytime since last Sept-Oct. Second, the indexes keep chopping away at their key resistance levels: 139.50 for SPY and 72 for IWM. Those levels also represent a 50% retracement of all losses since the December 26th top (”Merry Christmas!”). To gain back more than half of those horrendous losses on a closing basis should provide a very tradeable rally and strong gains in the most solid stocks.
This wouldn’t necessarily the mean the bear market is over. But.. the “long term” is merely a collection of a vast number of “short terms.” Every one counts.
75% invested, no hedges
