A Big Stock Market Rally May Be Coming Soon!
There has been speculation about the possible stock market rally that can take place this month due to the Santa Claus let bullish sentiment in the market. John Navin in an article on Forbes.com analyzed the technicals that are making this coming stock market rally to appear big. According to John, the astonishing stock market recovery this Friday is maybe a signal that the investors might not be as worried about Europe’s mess as it was being previously thought. Investors are also more enthusiastic to buy with the emerging strong evidence that the US economy is not bad as it was thought.
According to John, this was the third time in the last few months that the S&P500 index attempted to break above the 200 day moving average. The previous two attempts were made in October and November. This repeated banging at the key price level can lead to breaking through and going much further.
According to John Navin, you can compare this to a person banging at a door repeatedly. The next step can only be that person breaking down the door. The 50 day moving average is way back up for many weeks now. Old warhorse stocks like IBM can’t stop hitting new highs. All these are market signals for a possible big stock market rally.
A spark that can trigger this big stock market rally can be the Santa Claus led bullish seasonality coupled with early onset of the January Effect. But the primary reason that is driving the above technicals seems to point to a stock market rally based on the not so bad after all sentiment in the market as compared to things are much improved sentiment.
According to John Navin, none of that will matter if S&P500’s 200 day moving average is taken out on volume with two closes above that level. The short term target can be May’s 1360 high mark and beyond that it can be a surprise.
Bill Poulos is a stock trader from Michigan. He has many decades of trading experience. He regularly swing trades stocks whether the stock market rallies or not. With his Market Mastery techniques, he weeds out 97% of the stocks that are poison for his stock portfolio in 20-30 minutes each night. Using his Market Mastery stocks swing trading strategies, you too can beat S&P500 by 5,420% or more no matter whether the stock market rallies or not!