Indices 9/30/2013 – More to Go “In the Long Run”


Due to all the recent turmoil with the “government shutdown”, I though I would take this opportunity to review the charts for the various indices. And similar to my other updates from earlier today, I will look at the indices from a monthly candlestick charting perspective. Each of the following charts are 20 year monthly candlestick charts.

S&P 500

S&P 500 Index 20 Year Monthly Candlestick Chart

S&P 500 Index 20 Year Monthly Candlestick Chart

 

In March 2013, the S&P 500 broke through a double top resistance line around the 1,550 area. In June 2013, the index pulled back to the 1,550 area and successfully held. There will be a little turbulence along the way, but can you say S&P 1,800 in the next few months? That will put the index up approximately another 8% from current levels. I feel this is a conservative estimate. I will show you why in another update.

 

 

 

 

Nasdaq Composite

Nasdaq Composite 20 Year Monthly Candlestick Chart

Nasdaq Composite 20 Year Monthly Candlestick Chart

 

The Nasdaq Composite also broke through a double top resistance area, except the Nasdaq did not make a new all-time high in the process like the S&P 500 did. Nonetheless, the Nasdaq is progressing quite nicely. It looks like the Nasdaq has at least 4,100 on its mind.

 

 

 

 

 

Dow Jones Industrial Average

DJIA 20 Year Monthly Candlestick Chart

DJIA 20 Year Monthly Candlestick Chart

 

I am not sure why the DJIA’s chart did not go back 20 years since those were my chart settings. I guess I have to submit a ticket to Think or Swim.

Regardless, the chart action is similar to the two indices charts from above and suggests that the DJIA has more room to run. The DJIA does show that some temporary weakness could be around the corner – while a new high was made in September, the candlestick failed to close at least 50% into the real body of August’s candlestick, which was also a “Bearish Engulfing” candlestick. When a “Bearish Engulfing” candlestick happens at the top of an uptrend, it usually signals a trend reversal.

 

Maybe this is an indication that the government is going to continue to try and “scare” me during Halloween month with shutting down this and “fiscal cliff” that. But based on the positive chart action I’ve noted above with the double top breaks, this investor is not going to fall for the “trick”, I want the “treat”. And I am going to use any weakness over the next month(s) to purchase additional shares of my favorite stocks in anticipation of new market highs in the long term based on my long-term analysis.

 

 

2 Responses to “Indices 9/30/2013 – More to Go “In the Long Run””

  1. just sirius Says:

    Bassman…great stuff as usual!!

  2. Limit5Bass Says:

    Thanks just sirius! I like the potential over the next few years based on those 20 year chart breaks.

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