S&P 500 - Tentatively Bullish

Last Sunday I posted that the market had confirmed an intermediate bullish shift in sentiment.  Therefore, the price movement on Wednesday & Thursday last week were exactly what we were looking for as entry points.  However, the price move was so dramatic that it reduced the slope of the intermediate signal line indicating that sentiment is tentatively bullish.  If the intermediate signal line (blue) peaks before crossing zero it will indicate that we will likely see new lows, but for now the slope remains positive.  As described in my August 19, 2011, since the long term sentiment remains negative and the slope of the 200 day simple moving average is not clearly positive it is still risky to make market entries, but the higher risk may lead to higher returns.  Therefore, a cost averaging strategy that accounts for the higher risk should be employed.

Note:  I have added the chart below to its own page (see tab at top) to be updated daily. 

9/26/2011 S&P 500 (click on chart to enlarge).