Stock Market Viewpoint

Stock Market Viewpoint
Reading the Tea Leaves...

Tuesday, December 9, 2014

Once Again...

Stock Market Technical Analysis

click on image to enlarge

Over the past several years, every time the S&P has reached maximum extension from its 324 EMA line there has been a 75 to 200 point pull back happen within 4 to 8 weeks of reaching the maximum extension.  During that 4 to 8 weeks of propping the market at the maximum extension level bonds always make a nice run and the S&P scratches out only a few more points.  This has happened over and over.  All an investor has to do is to sell out of stocks when the S&P first reaches the maximum extension level, switch over to bonds and make money on bonds during this propping period and then the fall.  Once the market gets oversold and a decent signal sets up, switch back over to stocks for the ride back up to maximum over extension.  

How many investors do it?  Maybe one out of a thousand switch from stocks to bonds at the arrival of S&P maxiumum extension.  

Trade well my friends