At DecisionPoint.com we have now been working on the idea that we’re in a bear market. We can’t know for certain till the market declines 20% or extra, however that appears a bit late to start responding to what seems to be bear market motion.
The market just lately went by two months of some good bottoming motion, then it made a robust break above the declining tops line. Can we now breathe extra simply relating to bear market prospects? Nobody is aware of how this can resolve, however over time I’ve realized to be cautious of breakouts. Let me present you why.
In early-2008 the market appeared to make a strong backside, and a breakout befell quickly after. Nevertheless it was a fake-out, which was adopted by the lion’s share of the almost -58% bear market decline.
There have been no less than 4 “fake-out breakouts” in the course of the 2000-2002 Bear Market decline. They provided nice promise, however in the end failed to stop the -50% decline.
Conclusion: Breakouts are sometimes alerts {that a} down development has ended, and typically not. We’re continuing on the idea that the bear market has not ended.
Technical Evaluation is a windsock, not a crystal ball. –Carl Swenlin
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Useful DecisionPoint Hyperlinks:
DecisionPoint Alert Chart Record
DecisionPoint Golden Cross/Silver Cross Index Chart Record
DecisionPoint Sector Chart Record
Value Momentum Oscillator (PMO)
Swenlin Buying and selling Oscillators (STO-B and STO-V)
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Carl Swenlin is a veteran technical analyst who has been actively engaged in market evaluation since 1981. A pioneer within the creation of on-line technical sources, he was president and founding father of DecisionPoint.com, one of many premier market timing and technical evaluation web sites on the internet. DecisionPoint focuses on inventory market indicators and charting. Since DecisionPoint merged with StockCharts.com in 2013, Carl has served a consulting technical analyst and weblog contributor.
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