Indices ready for a major rebound ?

Indices faced a barrage of unsettling news for many weeks, Greece,Spain,France,JPM,CSCO,PCLN....but we did not crash into multi year lows?

All we did was lose 5.10% from recent high of 1415.32.....This happened in 8 straight days of trading...

Underpinning of this markets is strong.......

Many CONTRARY signals are making me "super bullish"

- Individual investors are only 25% bullish, lowest level since Sep 22, 2011

- 40.9%  expect correction, matching lowest read ever

- Equity allocation @ 52% only lowest level since 2009, we all remember what happened after 2009?

All of the above goes against the fact, that all Indices held their support

RSI in major indices are as follows :

Nasdaq 37.34

S&P 500 38.08

DOW 39.03

IF we look back @ history of RSI in all indices, 30 level triggers a "major bounce"

SO..IF you are in it, you should get the benefit of upcoming "major bounce"

YES..it gets very PAINFUL near bottom ALWAYS....that is how we all know that "turn is @ hand"

On a personal note, my portfolio has taken a beating, I am down <21.81%> in Stocks YTD, thankfully my currency hedge is still UP 13.48% YTD....that makes my overall loss @ <8.33%> YTD.....

It is important to take a factual read of your YTD performance near lows of the year also, this tells you how you have performed YTD compared to indices...this may TRIGGER some strategy CHANGES...

As to equities, most of the previous leaders should perform again, some NEW leaders may emerge. Being FLEXIBLE is the key.

While we move UP from current level, it is important to show CONVICTION to strong stocks..let it ride UP........

Good luck with your OWN analysis & strategy.

BLOG does NOT give buy or sell.

Saleem