Some business television programming could cause damage to your investing strategy. To-night I caught a portion of Howard Green’s Headline, and I was mortified by the doom and gloom vacant content. His guests were Dumb & Dumber (I think they go by Randy and Brian). These two wouldn’t recognise a bull market if it bit them on the ass. What babbling – Greece this, the Euro Zone that, the U.S. credit down grade, please! All this has no relevance to investing.
Almost every stock component in the Dow Industrials is a beneficiary of the global growth story. China grows a new Greece every year. A recent CNBC commercial has this wise tip, “opportunities don’t come gift wrapped, they come in storms.” Did you profit from the storms of 1973-1974, 1986, 1998, 2000-2002, 2008 and last summer?
Enough fundamentals, our chart today is the daily closes of the Dow Jones Industrials plotted above the daily closes of the Nasdaq Composite spanning that nasty May – August mini-bear. Note the highest recovery peaks that followed the August lows. Now look at to-days close – clearly above their prior highs. Higher highs mean advances. Just for more technical support look at the S&P500, Dow Transports and most of the SPDR sectors – all except SPDR Materials above the prior rally peaks. For more technical evidence take a look at CNR and UNP – both back above the 200 day MA.