Is the Bull Market Back On?

Last week may have been the break-out traders have been looking for as major indexes finished positive for the week.

After several months of correction it looks like the 200-day moving average for the SPX is likely to hold support.  It has been tested several times.  Each time a wave of buyers showed up.  This is classic correction/recovery territory for a bull market.

The recent push higher has driven the markets into a slightly over-bought situation, but this may not lead to a significant pull-back from here.  If the SPX were to pull back though, it support is likely to materialize at the 2700 level, or just below at the 50-day moving average.

The ‘set up’ right now appears to be one for the markets to move higher from here.  Last week’s move validated support and pushed through the psychological resistance level of 2700.  If this week finishes higher it’s likely the markets will continue grinding higher to re-test the January highs for the year.

Ironically, while the markets are showing ‘good news’ with things recovering, it appears to be the ‘bad news’ cycle that keeps things moving higher.  Too good and markets worry the Fed will change monetary policy.  Too bad and things are actually pretty bad.  But not good?  That seems to be the Goldilocks spot:  not good enough for the Fed to change, but not bad enough for money to move out of the markets.

Goofy times we live in.

IMPORTANT DISCLOSURE INFORMATION

Please remember that past performance may not be indicative of future results. Different
types of investments involve varying degrees of risk, and there can be no assurance
that the future performance of any specific investment, investment strategy, or product
(including the investments and/or investment strategies recommended or undertaken by
BigFoot), or any non-investment related content, made reference to directly or indirectly
in this blog will be profitable, equal any corresponding indicated historical performance
level(s), be suitable for your portfolio or individual situation, or prove successful. Due
to various factors, including changing market conditions and/or applicable laws, the
content may no longer be reflective of current opinions or positions. Moreover, you
should not assume that any discussion or information contained in this blog serves as the
receipt of, or as a substitute for, personalized investment advice from BigFoot. To the
extent that a reader has any questions regarding the applicability of any specific issue
discussed above to his/her individual situation, he/she is encouraged to consult with the
professional advisor of his/her choosing. BigFoot is neither a law firm nor a certified
public accounting firm and no portion of the blog content should be construed as legal
or accounting advice. A copy of the BigFoot’s current written disclosure statement
discussing our advisory services and fees is available for review upon request.