Bear Market Remains

Starting today, I will begin posting an updated "Bull vs Bear Market" Chart at the bottom of the blog. This chart measures the amount of pressure that is being exerted by the bulls or bears. Generally speaking when the model is less than 0 and falling, we are in a bear market and bearish pressure is rising (ie the bear market is getting stronger and more intense). Over 0 and rising trend argues for the exact opposite. As you can see, we reside in a bear market (surprise surprise) but the pressure has waned over the past few weeks as the markets have rallied and various other indicators have begun more bullish or less bearish (pick your poison).

For informational purposes, the model is comprised of mostly market based indicators as I rarely believe the government stats that are posted (except for a few which I will talk about from time to time). This model gives me a guide in terms of asset allocation and how I should trade a given market. It is but one though of my overall indicators I use to measure the marketplace. This however is an extremly important piece and when it says bull or bear, I listen.