Ticker Sense Low, Market Corrected 4.7% - Is the Bottom In?

Yesterday the S&P500 (Charts and Quote) reached a level 4.7% below its all-time record high.  At the same time, the Fear and Greed sentiment indicator hit a record low yesterday:

• Fear & Greed Index Hits Record Low of 3

Notice on this chart how the S&P500 rebounded sharply after touching the dotted blue support line on my two graphs below. 

S&P500 Charts with Resistance and Support

While I think a correction all the way down to the 200 day moving average, MA(200) on my charts, would make for a better, long-term low, I believe we have enough for a short term low now.  

After taking profits in my positions when the market was hitting record highs, I started adding to my shares again this week with a new buy alert sent to my subscribers on Monday when this Ticker Sense chart indicated a possible low was close.

Ticker Sense sentiment is measured weekly and reported on Mondays so it often turns up AFTER a short-term bottom is made.  

What do you think?  

Will the market rally to a new high somewhere below the dashed red resistance lines on my top two graphs then make a bigger correction to the 200 day moving average? 

New Feature for my Monthly Newsletter:

• You DO NOT NEED TO READ the complete newsletter each month.  Starting with the November issue, I will write the new content in black with the content repeated from the past month in blue so you can quickly skip ahead to what is new each month. 

Ticker Sense Blogger Sentiment vs S&P500 Chart - May 2014

This graph shows the weekly close for the S&P500 index graphed vs. the weekly reading of "Ticker Sense Blogger Sentiment" (note 1) as of 5/12/14.

"Ticker Sense Blogger Sentiment" (details below) is short term market outlook for the next 30 days.

During the the last three years of charting this data, the market rallied sharply after every time my blue line of "bulls over bulls plus bears" fell below 35%.  Will this time be different?

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See my just published article: 

• SPY 1% Off Record High, While ECRI's WLI Sets A 6.3-Year High
  
• ECRI Warns the commonly-touted “upturn” in earnings growth is largely illusory. 

Today's Sentiment Data:

Note 1:  From tickersense.typepad.com

Ticker Sense Blogger Sentiment Poll is a survey of the web's most prominent investment bloggers, asking "What is your outlook on the S&P 500 for the next 30 days?" Conducted on a weekly basis, the poll is sent to participants each Thursday, and the results are released on Ticker Sense each Monday. The goal of this poll is to gain a consensus view on the market from the top investment bloggers -- a community that continues to grow as a valued source of investment insight.

Ticker Sense Blogger Sentiment vs S&P500 Chart

This graph shows S&P500 vs Ticker Sense Blogger Sentiment as of 4/23/14.  

"Ticker Sense Blogger Sentiment" (details below) is short term market outlook for the next 30 days.

The apparent bottom of blogger sentiment matches the bottom of the recent pull-back in the S&P500.   As the chart shows, these bottoms over the past few years were followed by rallies that often went to new highs.

My newsletter "Explore Portfolio" made a new high yesterday as added I on the recent market pull-back and am now looking to take profits again.

Learn the "Core and Explore" approach to investing
with "Kirk Lindstrom's Investment Letter"

Subscribe NOW and get the April 2014 Issue for FREE! !   
(Your 1 year, 12 issue subscription will start with next month's issue.)
(More Info, Testimonials & Portfolio Returns)

From tickersense.typepad.com

Ticker Sense Blogger Sentiment Poll is a survey of the web's most prominent investment bloggers, asking "What is your outlook on the S&P 500 for the next 30 days?" Conducted on a weekly basis, the poll is sent to participants each Thursday, and the results are released on Ticker Sense each Monday. The goal of this poll is to gain a consensus view on the market from the top investment bloggers -- a community that continues to grow as a valued source of investment insight.