Bear Market Rally!

Wow! What a day on Wall Street. The bears were in full retreat. The S&P 500 ended the day up 7.08%. Stocks jumped across the board after the Treasury detailed its plan to relieve banks of its toxic assets.

Back on Thursday, March 19, I mentioned that the market was primed for a bear market rally. With today's move, the S&P 500 has rallied 23.5% from its March 6 low of 666.79. Is this it to the rally or do we have more to come? (Refer to the box inside the following chart of the S&P 500.)

As usual, our focus will be on the exponential moving averages. The 15-Week EMA is still below the 40-Week EMA. Therefore, any rally, as such, is just a bear market rally until the 15-Week EMA penetrates the 40-Week EMA. Stayed tuned!


Note: To enlarge, click inside the chart.