LunaticTrader

Investing with the Moon

Further upside

Posted by Danny on May 6, 2013

Markets continued to march higher last week, and we now have clear breakouts to the upside in place.
Such a strong performance is not unusual in eclipse green periods, as we explained a few weeks ago.
We have another week of green period to go, so further gains are in the cards, but I think we will give back a good portion of the recent gains in the 2nd half of May, when we will enter a new red period.

Let’s have a look at the S&P 500 index (click for larger image):

S&P 500

We got a nice breakout above the 1600 resistance level and now there is further room to rise to 1650 and possibly 1700 later this summer.
Some consolidation is likely later this month, but as long as the S&P doesn’t fall back below 1540 things look pretty good going forward. I would now set sights on a probable summer high (July or early August) around 1700, then a more serious market correction.

My Earl2 indicator turned upwards last week, and the orange line is about to cross above the red line, which would reconfirm a buy signal.

Good luck,
Danny

Enhanced by Zemanta

Post a comment (disagreement also welcome):

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

 
%d bloggers like this: