If you have been sitting on the sideline waiting to dip your foot in the market but believe this may be a "sucker" rally, here is something to consider. The Coppock Curve turned upward from a position below the zero line for the first time since this bear market started thus triggering a buying signal. Please recognized that the Coppock Curve is utilized as a tool to identify the bottom of the market after which it had already occurred. You can see that the market closed at 8500 on May 29th, 31% above the low of 6470 in March. A simple way of looking at this is to view the indicator as a low-risk, long-term buying junctures. The major risk faced the market at the bottom, the possible collapse of Citi Bank and Bank of America, was alleviated.
If you bought during the March low, you were taking major risk and thus should be rewarded with your investment doubling, tripling, or quadrupling in short period of time.
For those who are waiting to buy into Mutual Funds or Index Fund, I suggest you begin your accumulation with cares. I favor company specific approach because I believe the earning power for banks will not be back to where it once were. More on this in my later article.
The Coppock indicator stood at -380 at the end of May 2009, upped from -386 from April 2009.
During the great depression, the indicator had two false signals in February 1931 and August 1931. The true sign of the bottom occurred in August 1932 when the indicator reached -676 and reversed up to -635. A 42 points move. What we are witnessing could be a false indication. I would have to see the indicator decline in June to make a more bullish call.
This could be the beginning of a greatest investment opportunity if you look in the right place. I suggest you begin accumulating shares but with caution!
Art
If you bought during the March low, you were taking major risk and thus should be rewarded with your investment doubling, tripling, or quadrupling in short period of time.
For those who are waiting to buy into Mutual Funds or Index Fund, I suggest you begin your accumulation with cares. I favor company specific approach because I believe the earning power for banks will not be back to where it once were. More on this in my later article.
The Coppock indicator stood at -380 at the end of May 2009, upped from -386 from April 2009.
During the great depression, the indicator had two false signals in February 1931 and August 1931. The true sign of the bottom occurred in August 1932 when the indicator reached -676 and reversed up to -635. A 42 points move. What we are witnessing could be a false indication. I would have to see the indicator decline in June to make a more bullish call.
This could be the beginning of a greatest investment opportunity if you look in the right place. I suggest you begin accumulating shares but with caution!
Print this post
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.