Overlay a long term chart of Japans Market over the NDX. History repeats itself. We are just halfway there. The Macros Environment mean noda to my shortterm trading. But, to declare a new bull is just a joke. How about a new trading range???? better odds.
The Japan example is simply to point out that there can be powerful rallies that exist within the confines of a continuing bear market. However, the case can easily be made for us following the Japan model, as every step we've taken thus far economically has mirrored them in an eerie fashion. I'm not just using chart comparisons to draw parallels, I could write a page full of all the social and economic reasons we could easily be mired in a bear for many years, while I still can't find nearly enough reasons to match that for making a bull market case.
The trouble is that a 50% retrace from the all time highs would be about 5000. We are either going to go back to 5000, or we will easily smash the all time highs in the next few years, we have only retraced 38% on the monthly dow charts. The is also strong divergence on some indicators that I follow that would suggest a negative reversal on the 10 year chart dow chart.
The war is over. The data can no longer be ignored. Good data is critical in May, for this rally to continue.
Actually, there are reports that the current bullishness is very high. Also, the markets are going up on hopes that the negative economic news is merely reflective of the past, and hopes that things are about to boom. But when spending, labor, manufacturing, profits and other such numbers remain stagnant, the market will turn right back around (just like the multiple false hope rallies of the last couple years-how many years will we hear about the 2nd half of the year turnaround before it actually happens?).
divergence shmergence. People are going to be MUCH MORE careful about valuations after the rediculous extreme valuations seen during the bubble years, ones that cause people to look back at the notion of the great "new economy" with embarrasment and/or contempt!