• 13 hours Feds Target Forex Company In $75 Million Ponzi Scheme
  • 16 hours The Surprising Catalyst Sending Some U.S. Home Prices Soaring
  • 19 hours Is The Global Bond Bubble About To Burst?
  • 21 hours Investors Are Piling Into Tax Exempt Municipal Bonds
  • 2 days Strong U.S. Dollar Weighs On Blue Chip Earnings
  • 2 days How Millennials Are Reshaping Real Estate
  • 2 days Is America's Love For Cars Fizzling?
  • 2 days Increased Solar Demand Could Spark Silver Buying Spree
  • 3 days Amazon Calls It Quits On Alibaba’s Home Turf
  • 3 days Market Euphoria Weighs On Gold
  • 4 days Did Facebook Just Become ‘Uninvestable’?
  • 4 days Electric Vehicles Are Reshaping The Mining Industry
  • 5 days Buffett, Dimon Voice Support For Stock Buybacks
  • 5 days Newmont Goldcorp Now World's Top Miner After Sealing The Deal
  • 6 days Canopy Growth Eyes U.S. Pot Producer In $3.4B Takeover Deal
  • 6 days U.S. Slaps New Sanctions On Cuba To End ‘Glamorization Of Communism’
  • 6 days The Unstoppable Electric Bus Revolution
  • 6 days Pinterest, Zoom Launch Much Anticipated IPOs
  • 7 days Marijuana’s Bizarre Bottleneck Isn’t What You’d Expect
  • 7 days Climbing Stocks Weigh On Gold, But A Turnaround May Be Near
Tesla Struggles To Compete In European Market

Tesla Struggles To Compete In European Market

Tesla continues to catch the…

Trade In Counterfeit Goods Hits Half A Trillion Dollars

Trade In Counterfeit Goods Hits Half A Trillion Dollars

The counterfeit market has breached…

  1. Home
  2. Markets
  3. Other

The State of the Trend

With 2014 drawing to a close, it's time to look at the big picture one more time and find out where we stand from a long-term point of view.

We'll start first with an update of the SPX monthly chart we posted last December:

SPX Monthly Chart to December 2013

It clearly shows that the trend has not only remained intact, but is showing a willingness to accelerate to the upside. Whether such an acceleration is sustainable is a question that needs close monitoring in 2015.

If we stick to the monthly time frame, but look at it with a different set of TA tools, we notice that the index has been following the 2011 angle very closely, and so far hasn't shown any sign of deviation from that trend. Previous rallies have ended at the crossover of the two averages, currently pointing to 1900 (August 2014 low) as the danger zone:

SPX Monthly Chart

To gain a better historical perspective, we need to switch over to the DJIA index. In terms of DJIA history, the current rally is shaping up so far to be the third longest and ranks 5th in terms of percentage gains:

Dow Historical Rallies 1896-2014 Chart

Speaking of DJIA history, it should also be mentioned that for the last 120 years the ratio of bullish to bearish years ending in 5 is 11 : 1 in favor of the bulls (with 2005 being the one losing year when the index finished marginally (less than 1%) lower. To easily digest this information, and to make it easier to follow in 2015, we've isolated the bullish from the less bullish years to arrive at the following swing charts:

Very Bullish Swing Chart
Data courtesy of Gann 9

In summary, the trend for the DJIA and SPX remains strong and well within historical boundaries. The collapse in oil prices and simmering geopolitical tensions are building a formidable wall of worry which the markets have been climbing succesfully so far (with a little help from your friendly central banker). By avoiding panicking, keeping a clear and open mind, doing your own analysis, and monitoring a few simple TA tools and technical levels, you should be able to stay on the right side of the trade.

Less Bullish Swing Chart

Wishing you all a happy holiday season and a prosperous 2015!

 

Back to homepage

Leave a comment

Leave a comment