Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.



• When the S&P 500 (SPX) moves 10% over its 40-week moving average, the average gain before moving back below it is 10.4% in just under 11 months. The SPX reached this level in June at 988.

• The average "peak gain" (as measured by price at move over 10% above MA to peak price before a move back below 40-week moving average) over the 10 prior instances, using weekly data since 1980, was 19% over an average of 9 months.

• 80% of the "peak gain" signals produced double-digit results. The SPX is currently up 4.6% in 4 months from the 988 kick-off prices. Providing peak price gains and the time it took simply provides some Signposts along the way. We are under no illusion that we can pick the "peak price" when it comes.

• This is another example suggesting there is further upside over the coming months, reinforcing our Upside Ahead? thesis outlined in July. At worst it argues against aggressive selling because a market with this trajectory, liquidity and limited selling pressure takes time to turn and normally continues higher.

Exhibit 1 - In June the SPX was > 10% above its 40-week moving average - that hasn't been bad.

Exhibit 2 - Once the SPX gets 10% above its 40-week moving average...what comes next?

< Previous
  • 1
Next >
no positions in stocks mentioned
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Featured Videos