If you ask me, the current bull market in U.S. stocks is hanging by a thread.
In fact, a decline that takes the Standard & Poor's 500 Index down below the 1,040 level - roughly 7% below where it closed yesterday (Wednesday) - would probably murder the bull-market case for stocks.
But until that decline actually occurs, don't rule the bulls out for the count.
That "thread" may be tougher than you think.
To see what's in store for U.S. stocks, please read on...
Lowry Research Corp.
Article Index
Bull Market Update: U.S. Stocks Are Hanging By a Thread - But It's a Tough Thread
Should Investors Sell in May and Go Away, or Ride the Bull Awhile Longer?
I'm sure you have heard the old saw that it's a smart idea to "sell in May and go away."
That concept is based on the notion that the May-to-November span provides a weak environment for investors. I have already heard the cry go up recently because the major indexes are already up a lot more than anyone expected, and this would seem to be a convenient time to take profits.
Yet like most old market adages, there's not much substance to the concept if you take a good look at history.
That concept is based on the notion that the May-to-November span provides a weak environment for investors. I have already heard the cry go up recently because the major indexes are already up a lot more than anyone expected, and this would seem to be a convenient time to take profits.
Yet like most old market adages, there's not much substance to the concept if you take a good look at history.
Stock Market Buying Power Hits New Rally High, as Demand Outpaces Supply
Checking in with the volume experts over at Lowry Research Corp., it appears that U.S. stock market buying power hit a new rally high last week, while selling pressure hit a new low.
That reflects the same pattern of expanding demand and contracting supply that has characterized the entire rally out of the March 2009 lows - a rally that's now one year old.
According to Lowry analysts, if you look back over the past eight decades, every major market top has been preceded by a sustained period of rising supply and falling demand as profit-taking becomes increasingly aggressive.
And that's not all. If you look at the six-month stretch that precedes a market top, advance/decline (A/D) lines have always deteriorated for at least six months before a major top. At the moment, by their measures, the U.S. market remains in the first phase of a long-term uptrend, which is the lowest-risk period for new buying after a bear market.
That reflects the same pattern of expanding demand and contracting supply that has characterized the entire rally out of the March 2009 lows - a rally that's now one year old.
According to Lowry analysts, if you look back over the past eight decades, every major market top has been preceded by a sustained period of rising supply and falling demand as profit-taking becomes increasingly aggressive.
And that's not all. If you look at the six-month stretch that precedes a market top, advance/decline (A/D) lines have always deteriorated for at least six months before a major top. At the moment, by their measures, the U.S. market remains in the first phase of a long-term uptrend, which is the lowest-risk period for new buying after a bear market.
Upbeat Earnings Will Fuel the Bull Market's Next Leg
When it comes to the health of the U.S. stock market over the next few weeks, corporate earnings will tell the story. Alcoa Inc. (NYSE: AA) kicks off the third-quarter earnings season on Wednesday. My guess is that over the next few weeks, as third-quarter earnings are reported, we will have the opportunity to witness […]
U.S. Stocks: Winning Streak is Over, But Bull Market Continues
The winning streak is over. But the outlook for stocks remains upbeat. U.S. stocks on Friday suffered their first setback after six straight days of gains, but the damage wasn't severe. No news appeared to precipitate the decline, so chalk it up to light profit-taking. In the Friday session, the Dow Jones Industrial Average lost […]