March 22, 2010 Free Edition of the Monday Morning Review

THIS WEEK'S STOCK MARKET TREND SIGNALS   *************************************************************************** (The signals shown below are the "regular" MACD signals, NOT the Advanced MACD signals, which are available separately for only $4.95 a month.  See our website for details).   Shown below are the current "Weekly" signals for the Dow Jones Industrials, S&P 500, and NASDAQ using the "regular" MACD (as is available for free on many investment websites).  These can change quickly, but can also go weeks or months between changes, so be sure to check each week's email.  The Longer-Term "Monthly" signals (rarely change) are shown below.  Then, at the bottom we provide our big trends for interest rates.   Dow Jones Signal       S&P 500 Signal            NASDAQ Signal        LONGER-TERM (L-T) STOCK MARKET TREND SIGNALS (The signals shown below are the "regular" MACD signals, NOT the Advanced MACD signals, which are available separately for only $4.95 a month). These longer-term signals are based on 'monthly' intervals for the "regular" MACD, meaning that signals can only change at the beginning of the month.  As such, these signals can go for months or years between changes - BUT when they do change it pays to take heed, since it signals a potentially VERY IMPORTANT change in trend or direction for the market as a whole.  Subscribers that don't change their investments very often will usually follow these signals since they don't change very often.   L-T Dow Jones Signal   L-T S&P 500 Signal       L-T NASDAQ Signal      INTEREST RATE OUTLOOK   These interest rate outlooks are based on the price and yield trends for U.S. Treasury bonds of various maturities.  This kind of information is helpful for those investing in certificates of deposit, applying for a loan, and other reasons where the interest rate outlook is critical.  While rates could move counter to the signals shown below from time to time, we show the LARGE trends for these rates, based on the monthly interval MACD.   Short-term (3-6 Months)   Medium-term (2yrs-5yrs) Long-term (10yrs-30yrs)         COMMENTARY:   Good News?   MACD Outlook and Other Considerations   As bad as things look globally and in the U.S., the regular weekly MACD for both the S&P 500 and the NASDAQ have both crossed positive, presuming these major indexes don't fall in a major correction this week.  Yet, the Dow Jones Industrials have not turned positive, lagging these other two indexes.  For these weekly signals to be confirmed, this week will need to close 'up' for the week, to generate an official "up-trend" signal.  However, for now, the markets seem to go higher, day after day, in a rather unusually long series of days without so much as even a little sell-off (Friday wasn't really a 'sell-off', and involved the expiration of options contracts, which scrambles the picture).  Discuss this development with your financial adviser, and decide whether to invest in stocks once again, or add to your stock positions.  You may want to wait for ne xt week and whether there's a confirmation or not.  We are not financial advisers and can't make any specific recommendations (we don't know your particular circumstances, goals or investment tolerances), but we take these new signals to mean it's time to look at alternatives, including stocks or stock mutual funds, keeping in mind though that these trends can also change -- sometimes in a heartbeat!  The longer-term monthly regular MACD still reflects the markets overall upward bias, as shown above.  If the regular weekly MACD's for the major markets do reverse, and the stock market corrects, it could be months before the regular monthly interval MACD would go negative, signaling a 'downtrend'.  So, take all this into consideration when deciding what to do.   So, does this mean there's no more issues to be concerned with, and it's "off to the races"?  Not by a long shot!  There are many warning signs that most people can't "see" that tell us to be cautious.  For example, some of our other technical indicators reflect an "overbought" market in the very near term (meaning stocks could go down some, since all those who are going to buy stocks have already done so, and there's nothing left for investors to do but 'sell' -- or so the 'overbought' hypothesis goes).  Yet, as our subscribers know, markets can stay 'overbought' for a long time before they correct.  This helps explain the low volume, which is a warning sign as stocks drift higher.  There are some other, very dire indicators of things to come that we detail in our paid newsletter, the Advanced MACD and "Hard Core" analysis.  None of these major financial or political developments will, in themselves, cause or stop the stock markets from following their natural ebb and flows, but these developments can push them around or even halt the markets if severe enough.   How important is it to time the market?  Consider that, according to the Employee Benefit Research Institute's 2010 Retirement Confidence Survey, a stunning 43 percent of American workers have less than $10,000 in their retirement accounts!  And, that excludes any home equity or pension benefits.  If that sounds bad, the report goes on to show that 27 percent of the workers it surveyed had less than $1,000 saved for retirement.  Worse yet, 53 percent had not tried to figure out how much they would need once they retired.  As sad as all this is, how are those who are trying to retire supposed to make it when they have their accounts tied to the stock market and taking huge hits from the crashes of 2000 and 2007?  What if they could have gotten their money out of stocks and bought bonds, or even money market funds just after those crashes started?  They could have side-stepped all that pain and the loss of their hard-earned money, getting back into stocks when the coast was clear.  That's what the MACD does; that's what our newsletter is designed to do -- help you avoid (most) of the crash, and take advantage of (most) of the rallies.  Not even professional investors mind missing the absolute bottom or ultimate top -- they are extremely pleased to get that nice, fat middle portion of profits.  That's what we do, and that's the power of the Monday Morning Review.     Take care, and all the best for your health and investment portfolio.      J.E. Rapp, Editor-in-Charge     (Major market action could be coming:    Let as many people know about our newsletter as you possibly can, and ask them to subscribe.  The markets are always changing, and you can help others by getting them the information they need to navigate whatever comes.  Thank you. )