I have to admit we are feeling pretty good about our recent calls after today's action. We have been reporting for some time now that we saw the tech stocks getting ready to move. I didn't expect it to happen so soon after our Thursday call, nor with such power, but Miss Market has her ways.
All the major tech indicators moved 3 or more percent today. On top of that, all of the major indexes punched through their 50 day moving averages, another good sign. Our momentum indicators, of course reflect this action. Our slow momentum indicator jumped back into the neutral zone with a reading of -4.05. That is the highest it has been in a while. All the indexes are now pushing the neutral zone on our slow momentum reading. We have been here before, but this time we are a bit stronger and have a big base that has been built since late January. We still need to move out of the neutral zone before we can put away the bear rug and pull out our bull horns. I think we will do it this time, but stay tuned for it to actually happen before placing big bets.
I am not a prognosticator of the economy in general, so the moves we are discussing do not necessarily mean there is or isn't going to be a recession, or that earnings will be good, or inflation is under control etc. We just read aggregated momentum and give a sense of where the market is headed regardless of what all the background noise is about the economy and politics. Its hard enough to read the market, without having to figure out which pundit is lying, or which economic indicator is more important than the next. I believe if you study Miss Market long enough, all the other pieces will fall in place.
Lots of excitement is going on with our TradeWinds Top 25 lists and Black Box, so check them out.
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