The BIGGEST Week Of 2008!

FUNDAMENTAL ANALYSIS
In case some of you guys are living on Mars, the Dow posted its BIGGEST one week gain of 2008 this week! The Dow was up 3.22% this week and held up its sideways behavior today DESPITE a horrific jobs report with unemployment beating estimates by 0.1% (5.1%) and job loss at a horrific 80,000 jobs for march! In fact, that is the most horrible number we have seen since 2003! So why is the market still so strong and bullish? That's because we need to see a capitulation in the jobs market before the stock markets can stage a recovery! On top of that, the jobs report is a LAGGING indicator! Lagging indicators tells you what HAVE HAPPENED, not what is to come and that means that the WORST job loss since 2003 is already BEHIND us! Got it? Remember what happened back in 2003 when job loss is this high? Yes, the stock market staged the biggest rally of the decade! Ok, so, this is yet another bullish number for the stock market and another reason the bullish volcano is erupting... let's take stock of the signs so far again:

1. Recovering ISM index
2. Oil and Gold getting beaten like dogs
3. Consumer Sentiment index collasped (its always grimmest before dawn)
4. Fed bailout of BSC is demostration of their resolve not to allow the financial system to sink.
5. Existing home sales rising suggests possible start of the bottom in housing market.
6. Extremely steep bond yield curve suggests that smart money needs to move back into value stocks soon. (which is already rising as money moved back to equities from bonds)
7. GDP has not gone negative despite widespread speculation on an academic recession.
8. Capitulation in the job market with an 80,000 loss in March.

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TECHNICAL ANALYSIS
Looking at the weekly chart for the Dow revealed an extremely nice phase of accumulation all of 2008 so far. A rounded bottom accumulation pattern can only mean one thing... UPSIDE EXPLOSION! So, what's stopping it now? The 12750 resistance level. If the Dow doesn't break through that level early next week, we could see a slight pullback before the Dow tries it again. Will it visit the Jan lows again? Definitely not! Even from a technical analysis point of view, there is no such thing as a triple bottom (P&F triple bottom is a different thing all together).


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