The stock market surrendered to the August lows and rallied on Friday

But, the huge bearish fundamentals facing us have not changed. The stock market fell below its bearish trend line on January 7, it was defined by the December 2 and December 17 highs.The price movement below its previous bearish trend channel was almost straight down. So, the market seems to be oversold. Breaking the August lows will, most likely, be preceded by a high well under the December 17 high. But, the odds of the stock market heading higher is very low. Since last January, the market tried and failed to move above its 1870 level thirty six times!

The Technical and Cyclical groups in my stock sector table show losses in almost every single sector that makes them up. Add huge losses in the Financial group, specifically the Banking Sector and the Financial Sector (e.g., brokerages). The only stocks that are rising are those that are most defensive. There is lots of money to be made shorting stocks.

Here is the chart of the S&P 500:


Put in your name and email for our
free weekly stock newsletter

You'll get:

* Weekly Emailed Stock Market Analysis

* Trading Educational Tips - once or twice a week



  • Every trader, no matter how good, has losses.


    The only ones that don’t are Ponzi schemes.

  • What kind of results will I get?


    You’ll get more wins than losses and average gains bigger than losses.

  • But, you need more than just good trades!


    Too much risk leads to disastrous losses.

    Geometrically increase your results with the correct use of risk.

  • How do I get started?


    Click subscribe (on the menu) and make a selection.

    Submit and you’re set to go once you receive a return email.