Market Report 12 April 2015

At the time of the last report, the Dow was at 18127 and it currently stands at 18057. The price action of the last couple of months now looks like a congestion area:
Screen Shot 2015-08-26 at 10.31.29
As you know, congestions are more likely to resolve in the direction of the move leading in than the opposite direction, so we should see further upward movement from here. That means there’s a good chance we’ll see more all-time highs. Progress has been somewhat laboured recently, but the chart clearly shows that the uptrend, and hence the bull market, is still intact.
It’s a similar story on the S&P500. Three weeks ago it was at 2108 and it is now 2102. It also has a congestion area look about it:
Screen Shot 2015-08-26 at 10.32.17
Like the Dow, further ATH’s are on the cards. It’s also useful to note that neither index is anywhere near overbought in the short-term; the Dow has an extension to the 20ma of just 0.9% and the S&P is only 1.1% extended. Both have comfortable 7-day RSI’s, being 64 and 66 respectively.
The Nasdaq100 is also slightly down over the period, declining from 4458 to 4422. It’s chart has probably the clearest congestion area and looks all set to continue higher:
Screen Shot 2015-08-26 at 10.33.23
It has exactly the same extension and RSI levels as the S&P, so again we do not have any overbought condition here.
As mentioned in the last report, the Russell2000 was looking good and that remains the case:
Screen Shot 2015-08-26 at 10.34.01
So all four US indices all have bullish charts, and I’m quite happy to be 100% invested in the Prudential’s US Pension Fund. As I mentioned last time, the switch into the UK only cost me 1% which I said would probably be made up pretty quickly by the US fund. Well, already the US fund is up by more than 5% since I went into it (helped by the currency) and I’m looking at another record-high valuation. It’s a case of all’s well that ends well.
(c) Robert Newgrosh 2015
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Apr 12, 2015