The End of the Recession

Well according to the definition of economic recession (2 consecutive calendar quarters of negative GDP) we are no longer in a recession. GDP numbers released on Friday show the 2nd straight quarter of positive GDP. This last quarter even grew faster than analyst predicted.

So what is the market saying? Well, we've been headed down the last few weeks but I think we still have upside potential. I have been going back and forth between calling for a pull back ending between Dow 10,300 and Dow 10,000. Look like we are in that area where I expect the Dow to turn higher (market closed Friday at 10,067).

I think we will turn any day now and resume our run up to Dow 11,000 or there abouts.
We are currently building a sell signal in the bond market, we are currently NOT building a sell signal in the stock market.

I'll keep posting AND I'll keep buying the total stock market.

A New Year, A new Decade

The total stock market as bench marked by the Wilshire 5000 index gave us a total return in 2009 of 29%. Not too bad. Since I last posted, the high in the Dow reached 10,580. I see no danger of significant drawdown. We will continue to invest into the total stock market on a monthly basis. Although we may see an occasional pullback, overall, I'm looking for more upside as we go forward into 2010. I see the Dow hitting 11,300 before the end of July.
Happy 2010 to you and yours.

On Track

I'm going to make a little correction to my last post. Instead of a pullback to DOW 10K with a run up, I'm now calling for a not so steep drawdown. Let's call it a pullback to around DOW 10,200 with a run up to around DOW 10,600 by year's end.
There now, don't you feel much better?

Going Forward

So I was looking for something like Dow 10,255 around October 30th. My call on the date was about 2 weeks too early. So from here we will probably fall back to somewhere around Dow 10K before we make another run up to close out the year.
Then let's say a drop to around Dow 10K during the week of December 1st with another run up to around 10,600 before the end of the year. OK? OK!

I Beg to Differ

I was just reading RS of Houston who if you don't know is a popular trader who publishes a newsletter. He said in his letter that "...this afternoon's sharp reversal was right on schedule and we view see this as confirmation of the beginning of a very nice correction."

Well, I beg to differ, my analysis tells me that we should be headed a little bit higher before any sort of pullback. As a matter of fact I see the Dow Jones Industrial Average going to around 10,255 by October 30.

As of this date the Dow has closed at 10,081.

I guess we'll see what's what and who's how in the next week or so.

3rd Quarter Recap 2009

The market has closed the week on a down note with the Dow posting a high of 9834.
This week marks the 2nd straight week of drawdown in the Dow. However, I still believe the 8877 area is still very strong support and the market is trading well above its 200 day moving average.

We have advanced some 3400 points in the Dow since the bottom in March and approximately 1100 points of that is what we have captured since we started to DCA back in.

If the market is going to challenge that support level of 8877 we should know by the 3rd week in October. Outside of that my analysis shows a run up to about 10,500.

So I am going to continue to DCA into the total stock market.

Done with MRGE

Well, that was a crappy bust. I bought this issue (1000 shares) at my price ($3.81) expecting $5.10 by end of July. The highest it got to was only $4.78. I got out at my stop ($3.43).
Let that be a lesson to you, don't buy stocks priced under $10.00. Regardless of volume. I suspect traders saw my resting buy @ $3.81 and filled it thinking they were going to make money on the way down. That didn't happen, I took their money and was glad to do it. But I was so married to my exit at $5.10 that I........well, you know.