I’m finally back! Almost died from food poisoning. For 2 days, I couldn’t get up from bed. Now, I’ve got almost all my energies back.
Anyway the markets rallied up to a high of 856 for S&P and 8083 for the Dow. And seeing that the indexes did not make a 5th candle reversal on the weekly charts, we might still be going up for the next 2 weeks.
Weekly charts for the Dow
Weekly charts for the S&P 500
As you can see from the charts, we had broke the 20 week moving average and since 4 weeks ago, the weekly for both indexes had been showing divergence up. We might have some more momentum to continue to go up above 8,500 for the Dow and 900 for the S&P with a few dips along the way.
Daily charts for the Dow
Daily charts for the S&P 500
As you can see, the MACD is already forming divergences down on the daily charts. Last year, the indexes formed divergent 6 peaks on the MACD from the 18th March 08 to its highest point on the 19th of June 2008 before the huge tank that followed. I believe this year, the same thing is forming. The MACD had already formed 3 peaks since the 10th of March 2009 and is in the midst of forming the 4th. Since the last MACD peak took 5 days to form, this current one should not take more than that to complete.
Lastly, I believe that this a bear rally. My bottom for this crisis is much lower at around 600 for the S&P and maybe 5,500 for the Dow. We should be turning back down to this level sometime after this current MACD divergence runs out.
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