Thursday, January 08, 2009

Still in a rising trend

The stock market rally has slowed, but it hasn't stopped. Recent S&P 500 index closing values have formed an ascending channel pattern.

Short-term sentiment has reached or surpassed the optimistic peaks of October 2007 and December 2006, so I'm convinced that this rising channel will end with a significant retreat. The first signal that the rally has ended will either be a violation of the lower trend line, or perhaps a shift to negative breadth, which has been solidly positive for several weeks now.

When the rally ends I will shift the remaining 25% of my Roth IRA from cash to GRZZX. Since the new tax year has begun, I will also deposit another $5000 to the Roth in stages at opportune times.

In the meantime, my larger but limited-choice 403b (similar to a 401k) remains in short term government treasuries. It's very frustrating to think what I could be doing with that account if I had the freedom to buy GRZZX with it.

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