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It’s Hard Out Here For A Bear…By Jeff ClarkWednesday, July 5, 2006 I’d love to turn bearish right here… but I can’t.
A few weeks ago, I suggested the stock market was gearing up for a rally and I targeted the 1290 level on the S&P 500. Now, as the S&P 500 zeros in on our target, it makes sense to start looking for bearish bets.
But I just can’t.
Everything looks just too bullish.
The stock market is overbought in the short term, and is vulnerable to a pullback over the next few days. But nearly all the technical indicators I follow are leaning bullish and suggest we have a few more weeks of upside to go.
So, like the weekend partygoer who simply can’t find the motivation to get up and go to work on Monday morning, the bear has hit the snooze button; rolled over; and settled in for an extended nap.
Meanwhile, the semiconductor index looks ready to shake off its hangover and get back to some serious work on the upside.
In fact, this is my favorite chart in the entire stock market right now…
 A breakout of a bullish falling wedge pattern is incredibly powerful and often leads to 10-20% gains within just a few days.
And if we’re going to see that kind of a move out of the semiconductor index, then there’s just no way to be bearish on the overall stock market.
Some of the stocks I like best right here are MEMC Electronics (WFR), Cypress Semiconductor (CY), and Teradyne Inc. (TER).
But the absolute best trade; the trade that makes the most sense; the trade with the highest probability of success, is the trade I’ll be sharing with my Trade of the Week subscribers this afternoon.
Best Regards & Good Trading,
Jeff Clark
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Big Pharma breaks out: Merck & Co. hits new 52-week high.
Market volatility under wraps again… volatility index at 13.
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