Respect my comrade stock trading fighters. We might be at the dawn of another major bull run.

Pardon?

How can that be with so many Americans being jobless, banks being shut down, and home building taking a double douse to the downside?

Good question. It does appear ridiculous if you are a one-dimensional organism existing in the present.

But you are better than that. You were bestowed the capacity to picture yourself stock trading in the future. That higher level of thinking is something that makes you different from other beasts and micro-organisms that can merely reason in the here and now. While I acknowledge it’s not as fantastic as Torchwood time travel, it can make you a great deal of cash.

One of the most tricky lessons for amateur stock traders to take hold of is that the stock market is the future of the economic cycle anywhere from 3 to 9 months. In other words, all the price action taking place on the stock market today is a lay a wager on the place we imagine the economy will be 9 months from now. The stock market is yelling at us that in 9 months from the present, the unemployment rate will be lower, banks will no longer be failing, and housing construction will go back up. The earnings season that just ended verified that with 69% of all corporations posting earnings increases YOY.

Last Saturday I talked regarding how, with the downtrend channel breakout, we don’t know what new channel or formation will appear because we don’t have enough data so far. At this time with 1 week more of chart data, and zooming out on the stock chart to look at the bigger chart pattern, a model springs forth.

The S&P 500 has finished a Bullish Flag breakout.

Now short sellers and gold bugs will disagree with the chart pattern and say that insufficient volume is present for this to be a legitimate breakout but that is just not accurate. Provided you go back and examine the previous Bullish Flag breakout we had on the S&P 500, you will witness that the volume that has accompanied this breakout is over 23% greater!

The Bullish Flag was a perfect 38.2% Fibonacci retracement of the bull run that started in March of 2009. A 38.2% retracement is a typical retracement for a uptrend.

I am upgrading the Dow, Nasdaq, and S&P 500 to that of uptrend.

Free technical analysis to help you establish the trend of the Dow, Nasdaq, and S&P 500. Go to s & p trend This article, S & P Trend Up On Good Earnings Season is released under a creative commons attribution licence.