Indices have snapped back after testing 50 DMA 9 times in April alone.
There was lot of jitter in this TAPE since April.....
We kept testing 50 DMA in fear of many issues
Slowdown in US in winter months caught everybody by surprise.....GDP came to almost flat.....
TAPE can foretell events of future which us humans do not and cannot......
Now that we know that slowdown is out of the way, market can go on making new all time highs....
S&P 500 should be the first one to move then Dow & Nasdaq can join in this party.
Now we have entered May..."sell in May crowd" is already positioned for sharp pullback...
BUT we may have a strong May based on what has happened in entire month of April, we had 9 test of 50 DMA in S&P 500 in April, that discounted lot of issues and selling of May came in April.....
Bulls are feeling pretty good as they have jumped to 57.4% from 50 area 3 weeks ago.....
CMF have been positive which shows overall accumulation...
Advance Decline ratio was pretty good on Friday in 2.5 to 2.9 area...another strong sign that things are perking up.
SO..it is time to remove "worrying hat"
TAPE is saying...i am OK for May....
SO ...take advantage of May and position in strong stocks, some sectors are in runaway mode like Data Security, some Semis & high growth tech.....
Do your own homework and find your winners for the month of May....
BLOG does NOT give buy or sell.
Saleem
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