Bullish Charts for a Bullish Market
Maybe you think you're on the wrong blog, since I actually have some "buy" recommendations today. But if you can't beat 'em, join 'em, and I'm sick of fighting the upward tide.
The Dow Jones Composite hit a lifetime high today. It is currently 12% above its peak during the Internet bubble. The Dow Transports also hit a lifetime high today, and it is 23% above its bubble high. The Dow Industrials is still about 400 points below its lifetime high, and it needs to cross above 11,335 before that becomes a possibility.
One compelling chart for a bullish case is this one of the NASDAQ Composite. It sort of kind of has an inverted head & shoulders pattern. Not textbook, by any stretch, but it keeps pushing its way into relatively clean territory.
The Gold market is one which seems clearly past its peak. The chart below shows nearly twenty years of data for the $XAU, and it seems to have hit a major top for the third time in a row (see circled prices).
First recommendation is NWRE (stop price: 21.53; in all cases, the stop price cited means any price below this should generate a sell @ market order). 
Second is Prudential Financial (PRU, stop price 74.52). I suggest waiting for a breakout to a new high before pursuing this one.
Radyne (symbol RADN stop 12.68) is next:
SCMR (stop 4.46) has been struggling for years. It needs to clearly break above this saucer, but if it does, it could mean a major move.
Lastly is TradeStation (TRAD, stop 13.33) which not only has had great price action lately but also a sensational increase in volume. Always a powerful combination....
3 comments:
Some comments on the selections. I put them through my mill and this is what came out - RADN and TRAD are ok look like they are just getting ready to run. PRU is iffy but over 77.50 it might be ok. Both NWRE and RADN appear to be topping. They've both been running for some time already and may need a rest.
I disagree with your comment on gold - I'm not a gold bug just a chart reader and the charts (both gld and xau) tell me that gold has a ways to go. It might take a brief rest but I don't think it's done.
But what do I know? Same's everybody else - nada.
Tim,
I hope you and Mike Stone are not ganging up to jinx the market :).
NASDAQ is kinda clear all the way to 2800 if it can have a healthy breach of 2400.
Keenly waiting on DJIA breach of 11430 to increase my bullish commitment.
RHAT also is a great buy if $31.50 is breached.
I was sort of anticipating the "if Tim is bullish, then it's all over" stuff. And that's probably fair! I imagine if God reads my blog He'll be more comfortable taking a few thousand points off the Dow now. The bears can thank me later!
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