Since the last post, the market has continued an upward trend. However, the blue line in the chart below is indicating that the market is sensing resistance (not completely unexpected as the price approaches the 200 day SMA). Although a good sign is that the long term sentiment line (green) has leveled out. This indicates that there has been an improvement in the long term sentiment. However, for safest entry point, wait until it crosses the orange signal line for confirmation. Also a good entry point may be soon after the green line seperates from the yellow signal line, but the risk for a reversal is higher especially since the slope of the 200 day SMA is negative . Remember also try to only make entries on days when the market has taken a significnat drop. Typically I wait until right before market close to place mutual fund purchase orders.
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| 10/21/2011 S&P 500 |
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| 10/21/2011 S&P 500 |
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