Sentiment Changing

3/23/2008

Dow index close higher on weekly basis first time for March. We have not seen problems associated with the financial system since the 1930's !! The FED has been working everyday to try to solve the financial crisis. As I mentioned on date 3/11/08, stock market has found the short term bottom. We could see it last Monday (3/17/08) the market gapped down amidst all the doom news and made new lows by mid day, but it rallied nicely to the end of day. This indicated the market sentiment has been changing to slightly bullish rather than too extreme bearish.
I want to point out that Dow has been formed short term triangle patterns ( +420pts on 3/18/08, -293 pts on 3/19/08, +262 pts on 3/20/08), also major indexes now seems appear to be bullish double inverse H&S patterns on 60mins charts. If the major indexes are able to breakout the necklines of these patterns, it would be bullish and begin a nice counter BEAR market rally!! Remember we are still in BEAR market. Our target for S&P would be in around 1345-1350 if it breaks necklines. Dow would be trading higher than the strong resistance 12750-13000 area.
Over the weekend, S&P has putting Lehman brother and Goldman Sachs in negative outlook mark. If these broker dealers can stay positive tomorrow, it prove sentiment is totally change and financial and bank stocks would be rebounded much higher compare with other sectors. And these two sectors would be very important to contribute the S&P index to breakout the patterns I mentioned above.
For short term bulls, S&P need to take out the resistance 1340-1345 area.