Stock Market ABC Correction Completing - Bull Market End of Year Rally to Begin This Week ?

By: Nadeem_Walayat

The S&P Closed on Friday at 1453, hitting more or less the target for the ABC correction low which coincided with the bull markets major support trend line, which now technically implies that that should be it for this sell off and for the bull market to re-exert itself.

How can I be bullish in the face of all the bearish news ?

Stocks bull markets tend to rise on a wall of worry, the time to actually get worried about stocks is when there is a lot of talk about a new paradigm and things are now different then ever before ! Which is not so with US and western stock markets, such as the UK.

As far as I am concerned, most market news is there to be ignored! In a bull market the mantra to sing is to buy the stocks on the dips, that way in a bull market I will only be wrong ONCE ! Unlike the plethora of bearish commentary over the last 12 months ! from the 4 year cycle peak that never happened, to the 5th of a 5th of a 5th following virtually every correction. Keep it simple folks, follow the trend.

That's my view point at this point in time until the price tells me otherwise. Yes There will be selling on Monday, and prior to the market open in some 20 minutes (UK) I am contemplating what else to buy at this time.......

Here are the charts from my last stocks article of 4th Nov 07 which illustrate my opinion in the lead up to the End of Year Rally. If I turn out to be wrong, then at least you will know that my portfolio is taking a hit.

Asian Stock Markets

I have issued several warnings over the last 3 weeks of severe downtrends in the asian markets, specifically warning of the relative weakness of Japan and Hong Kong and China primed for a crash. These trends appear to have kicked into gear, with the declines outpacing those in the west. I am still of the opinion that the west will be able to detach itself from the east, I have no 'news' scenario to support this at the time, but if and when it happens I am sure there will be plenty of news commentary to support why it is happening. My reasoning is purely technical in that the up trends in the east are NOT sustainable specifically China and Hong Kong. (21 Oct 2007 - Asian Stock Markets Expected to Trend Lower Into November )

Also I have received a number of requests by email concerning "The Real Secrets of Successful Trading", the part 2 to How I beat the 1987 Crash,. Having started to write the article, I found it near impossible to condense 20 years of trading experience down into a few short paragraphs without losing much of the message, so I have decided to write a book instead, hence there will be no part 2 article.

By Nadeem Walayat
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Nadeem Walayat has over 20 years experience of analysing and trading the financial markets and is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication. We present in-depth analysis from over 100 experienced analysts on a range of views of the probable direction of the financial markets. Thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

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