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Our current signal is BUY This signal was initiated after the close on June 27, 2005
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It looks as if the stock market is in the process
of forming a temporary top. As we have said a few times recently, the downward
correction that started at the beginning of February will allow higher gains in
the weeks and months ahead and is not a signal that the market is about to have
a long-term top. We believe any weakness in the coming days or weeks will be a
small correction within the continuing long-term uptrend.
The NASDAQ
Composite has finally broken above 2007 highs. By looking at most indicators you
can conclude that the stock market is becoming overbought enough for a pullback,
but subjective analysis of chart formations would suggest that the index will
move further beyond its breakout point before a small correction. Not knowing
how much further the index will go (if it even goes any further than today's
close) makes it difficult to know where it will fall to before t! he uptrend
resumes. Currently we are looking at the 2475 area for a stopping point. This
will fill the gap from the gap down at the open that occured toward the end of
February.
Unlike the NASDAQ Composite, from a subjective point of view,
the S&P 500 has extended enough beyond its breakout point for a pullback.
Here, we would expect a fall back to the breakout area of 1460.
The
Russell 2000 is looking much like the NASDAQ Composite. It has only begun to
break above 2007 highs. This would certainly argue that the index has further to
go before a pullback, but the stock market is overbought enough for a temporary
top to still happen here.
The most important point is that regardless of
any pullback in the near future, the long-term uptrend remains very strong.
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Take Care, Stephen Brown Founder of Nasdaq Wizard, LLC
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For more information:
Nasdaq Wizard, LLC
Email: support@nasdaqwizard.com
© Copyright 2009 Nasdaq Wizard, LLC. All Rights Reserved.
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