Has a Major Bottom Been Put In?
Despite a twenty plus percent rally since the March sixth low, the S&P still came up short for the quarter (its sixth straight) losing ~ five percent. Our numbers have been posted and can be seen on our performance page. While the jury is still out as to whether this current rally will turn out to be more than just another bear market rally (we've had four good ones), it is certainly more convincing than anything we've seen since July 2006. The fact that it continues to rally despite severe overbought readings is normally a very positive sign and one that is often seen at the start of new bull markets. As stated before, however, and not to sound like a broken record, selling pressure (source Lowry) remains stubbornly high and close to its March sixth reading. From a technical perspective, I'll be looking for this number to drop before becoming more bullish.
-Joe