"The technical backdrop has taken a distinctly bullish turn," says Michael Ashbaugh in MarketWatch's The Technical Indicator. Here, he looks at the market averages and a trio of stock ideas.

"Perhaps most obviously, the S&P has staged a 10-to-1 rally, and a 28-to-1 spike, from its 200-day moving average. And by any measure, this raises a bullish technical flag.

"With a gravity-defying rally, the S&P extended its gains, clearing resistance at 930 last Thursday. From current levels, significant resistance holds at the 2009 closing high of 946 while initial support rests at 930.

"Meanwhile, the Dow's near-term view is similar. With this week's rally, it's staged a 'V'-shaped reversal, breaking to one-month highs. Looking ahead, significant resistance holds at 8,799 - matching the 2009 closing high - while support rests at 8,580, matching the breakout point.

Continue reading MarketWatch technician raises 'bullish flag'

MarketWatch technician raises 'bullish flag' originally appeared on BloggingStocks on Mon, 20 Jul 2009 11:00:00 EST. Please see our terms for use of feeds.

Continue reading Serious Money: Outlook improving (AEO, BAC, C, & F)

Serious Money: Outlook improving (AEO, BAC, C, & F) originally appeared on BloggingStocks on Wed, 15 Apr 2009 17:00:00 EST. Please see our terms for use of feeds.

Written before yesterday's sharp rise, stock market historian and advisor Jim Stack had forecast an "imminent bottom" for the market. A long-term timer, he is not looking for quick pops and drops; rather, the "safety-first" money manager focuses on slowing positioning his portfolio for long-term, secular trends.

Indeed, in his InvesTech Market Analyst he was among the few to accurately forecast the current crisis; over the prior year and a half, he predicated both the bust of the housing bubble and the derivatives-based meltdown that would result.

After maintaining a defensive, cash-heavy portfolio during the market's downturn, he is now becoming more optimistic, noting, "All of our bearish extremes readings that precede the best stock buy opportunities are now in place."

Stack explains, "How can we put this bear market in historical perspective? No doubt about it, this bear market is a whopper - both in size and severity.

"With a 42.5% loss in the S&P 500 Index, it is rapidly closing in on the big bear markets of 1973-74 and 2000-02. In fact, no bear market in the past 70 years has declined over 50%.

"In severity, this bear has unfolded much faster than past bear markets, wiping out $6.7 trillion in stock values in barely 12 months - equivalent to over 90% of the loss in the 2000-02 bear market in two-fifths of the time

"In measuring impact on investors' portfolios, this bear has 'repossessed' more than 84% of the prior 5-year bull market gains! Both the DJIA and S&P 500 Index are back to price levels seen over 10 years ago in 1998.

"Why has the stock market decline turned so precipitous in the last few weeks? In bigger bear markets, investors always end up throwing out the baby with the bath water.

Continue reading Jim Stack: Market historian calls 'imminent' bottom

Jim Stack: Market historian calls 'imminent' bottom originally appeared on BloggingStocks on Wed, 29 Oct 2008 14:30:00 EST. Please see our terms for use of feeds.