The Weekly Report For April 6th - April 10th, 2009

April 5, 2009- Market Summary
The rally that we have been experiencing since seeing the March lows continued this week, setting new pivot highs in all four major indexes. With all indexes now trading above their 50-day moving averages, it seems that, at least in the short term, we are seeing a stong turnaround in investor sentiment. Now up more than 20% from our lows, we are in a new bull market according to the boiler-plate definition.

All four indexes are still far off of their 200-day moving averages, so from a longer-term perspective the trend is still down. It will be interesting to see what happens as the Dow, Russell 2000 and S&P 500 approach significant resistance in the future. If these indexes manage to break through these influential levels, we may see a further upwards movement towards their moving averages. If not, then the legs may fall off this rally, which could turn out to be a bear market rally. Traders looking to get long in this market may wish to do so, but be ready to take profits as the Dow approaches the 8300 level. Levels to watch for in the S&P and Russell are 875 and 475, respectively. (To learn more about levels of resistance, be sure to check out the Support And Resistance section or our Technical Analysis Tutorial.)

The Nasdaq 100 had a great rally this week, gapping up sharply through a significant resistance level. Nasdaq traders may wish to continue their long positions up towards the 200-day moving average.

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