Bullish Reversal this October
All markets look strongly bullish
I am not sure whether historically the month of October is a good month for stocks or not. But this October certainly has been a good month so far. The S&P 500 hit a near term low on Oct 4 and ever since has been going up. It is trending strongly bullish now and this week in particular was the bullish reversal per my model.
The S&P 500 is now up +4.5% over 1 month and all of that has come in the last 6 trading sessions.
The 10-day moving average has just crossed over the 50-day moving average as of yesterday’s close. The price chart does look extended specially after 6 days of higher closings straight. So, I would expect a small pullback. But nothing to be too concerned about
The Dow Jones also has a very similar price pattern. In fact the DJI is up +5% over 1 month - even better than the S&P 500.
The NASDAQ also similar price pattern although it is the laggard among the 3 major indices. It is up +3.2% over 1 month.
Yesterday I also did a sector analysis of the top 15 sectors and found that except for Biotech sector all the sectors are looking strong. In fact many of them have started trending bullish from neutral just this week.
The Russell 2000 is also trending strongly bullish and is up +5% in 1 month. Per my model the Russell 2000 looked the leader and I did go long the TNA which is the 3x leveraged small cap by Direxion Funds.