April 2009 - EquiTrend Market Watch

EquiTrend Market Watch


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Have You Seen This?

  • Rally takes a breather?

    In This Issue

    Rally takes a breather?
    Leaders bounce back again...
    Earnings forecasts show signs of hope
    Existing and new home sales fall
    Waiting for Case-Shiller
    Treasury demand surges as spending soars

    Quote of the week
    'Tax receipts are just collapsing. [The need to sell more debt] is a big issue in the Treasury market and it is ongoing. The surging budget deficit is the primary cause.' Head Stamford UBS Securities interest-rate strategist Chris Ahrens.

    Rally takes a break?
    It has now been seven weeks since this rally began and this week stocks took a break. Since hitting its low in the first week of March, the S&P500 is up nearly 28%. Last week we mentioned that the S&P500 index was 9.6% above its 50-DMA and that is about where it stayed this week (9.5%) so stocks remain overbought. But indexes are also still banging up against key resistance areas that taken together with how overbought stocks are across the board, increases the chances for a correction. And now this rally is losing momentum. If prices hold up it will show that investor demand and interest in stocks is increasing despite the technicals pointing to a drop. But that must be considered a long shot....
  • Rally now six weeks young...

    In This Issue:

    Rally six weeks old...
    Leaders down... no there back up again...
    Earnings, still not real signs of improvement
    Treasury sales still falling, so are housing permits and starts

    Quote of the week
    "Anyone who is doing anything sensible right now is either losing money or is out of the market entirely," Quant trader "who is seeing something scary in the capital markets" in article by Tyler Durham.

    Rally now six weeks young...
    This rally marked its sixth-week birthday this week. Since hitting its low in the first week of March, the S&P500 is up 28% with Financials leading the pack. But that being said, this and most other major indexes are getting really stretched (overbought) and 89% of the stocks in the SPX index are above their 50-day moving averages (DMA), which is the highest level since mid-2006 according to Bespoke. Last week we mentioned that the index was 8% above its 50-DMA and that extended to 9.6% this week. Another challenge that faces stocks this week is that major indexes are getting close to bumping up against key resistance areas that taken together with how overbought stocks are across the board, increases the chances for a correction....
  • Fifth up week in a row

    In This Issue:

    Rally five weeks old...
    Leaders jump out
    Falling consumer spending in the spotlight
    Still in sell mode but...

    Quote of the week
    "When we look at the systematic financial system we're in, and it affects every country in the world including Canada, I think staying bearish is the route to go," Economist Nouriel Roubini.

    Rally finishes fifth week...
    Stocks finished their fifth consecutive week of gains. Given the weak performances Monday and Tuesday with the S&P500 dropping more than 3%, Thursday's strong close with a gain of nearly 4% was a pleasant surprise for the bulls for a number of reasons. It came on the last trading day of a holiday shortened week and a strong close on the last trading day is a bullish sign. It means that investors are confident enough to hold over the weekend and a long one at that. However, weekly volume was below average and that should be a concern....
  • Longest running streak of weekly gains in eighteen months

    In This Issue:

    Rally still going...
    Leaders lagging
    The new earnings season kicks off
    Case-Shiller index implies worst home price declines may be over
    Economic metrics also leveling
    We're still in sell mode

    Quote of the week
    'Investors are still heavily in cash and the challenge they are facing is how to scale back into growth-oriented investments. For that reason, technology leadership is not surprising given many are flush with cash and little debt,' - David Kreinces, a portfolio manager with ETF Portfolio Management.

    Rally still going...
    It was another good week for the bulls. As Dan explained this week from his Miami home, there is a lot of cash on the sidelines looking to get into the market. Despite the fact that we are still bear market, cash doesn't do much good if it isn't working which is why this rally has been so explosive But the fact that pundits like Jim Cramer are so confident that a new bull market has begun is a bearish omen. At true market bottoms, the majority including the Jim Cramers of the world, have given up, and this is most certainly not the case now.