Monday, October 13, 2008

10 Bullish Charts, Signals, Indicators

Mr. Ritholtz is humble* about the timing of this post (12:30 p.m. Friday).
From The Big Picture:

Earlier this week, we discussed several anecdotal pieces of evidence that suggested we were closer to the bottom then the top.

Today, we look at specific data and charts that can provide some insight as to how extreme these present levels are. All these suggest to us that we are increasingly close to a bottom that can be purchased for an upside trade of 20-30% from these levels.

NOTE: We scale in over time, in 10% increments, and recognize that the bottoming process can take several months to several quarters to complete. Hence, slowly buying in is the key.


1. Relative Strength Indicator, SPX, 1928-2008

Ever since the beginning of the S&P500, the RSI's monthly indicator has only dropped below 30 on four occasions: 1929, 1973, 2002, and 2008.

All 3 prior instances were very close to lows....MORE

*Sunday, October 12, 2008 | 07:57 PM

This looks awfully familiar:


What does this mean? Are we going to rock and roll this week? Or is this a sucker play?

Was our Friday noon Buy call timely, or is there more downside acomin' ?

What say ye?