Well, it looks like the market’s momentum has finally turned the corner. The bulls have broken the downward trend, put in a new “higher-high” and looks poised to continue building on its most recent gains. At this point, I would not assume that the market is done and over with this financial crisis.
Instead, I would approach this as an intermission to a brutal opera concert; you’re glad there is an intermission, an if you can sneak out and go home early to watch the football game, then you are elated. Point being, remember the only two significant market rallies from earlier this year, where there was a Spring rally and then a Summer rally, both of which lost its momentum and then succumbed to another round of selling.
We could have a bottom, but it’s better to be skeptical, and believe that another leg down is still possible, then to be blindly bullish, and later be proven wrong.
Here’s the Nasdaq and S&P charts…