Merry Christmas and Happy New Year!

"But you, O Bethlehem Ephrathah, are only a small village among all the people of Judah. Yet a ruler of Israel will come from you, one whose origins are from eternity past." -Micah 5:2

The above verse was written about 700 BC by the prophet Micah. It predicts the coming of the long awaited Messiah for the Jewish people and the world. Jesus was born in Bethlehem among poor people, from the lineage of King David. He grew up and later established a three year ministry around the Galilee region of the Mediterranean. His life on earth, death, and resurrection fulfilled about 400 Old Testament prophecies which were made over the centuries about him. The mathematical odds of someone doing all these things are too great to even figure-- in fact, mathematically impossible to fulfill for someone who was not the Messiah. Yes, we can debate whether Jesus was actually born on December 25th, and when the Magi actually arrived, but the historical fact remains. The evidence of His Lordship is indisputable.

If you have never accepted Jesus as the Savior of this world, please take a moment now to ask Him into your heart. No matter what you have done, He will accept you into His family as His child! And you may then enjoy the full inheritance which Jesus, the Messiah brings!

Merry Christmas and Happy New Year!

Market Upside Bias Continues.. Watch the BKX

These past weeks have shown much volatility and many tradable swings in the market. As a whole, the major indices have made new yearly highs and/or are ready to challenge highs reached earlier this year. Even the Russell 2000 which has lagged the rest of the market is ready to break to the upside. Keep your eye on the Bank Stock Index (BKX.X) as this index is still looking like it is trying to find a bottom. Although the market indicators such as the Stochastics and MACD are beginning to show it is ready to follow the other indices higher. Banking stocks NEED to participate if this market will move higher. And it will be a sign that the economic recovery is on more stable ground.

Inflation is still relatively benign, interest rates remain at historic lows, and gold has broken down from its recent parabolic rise. The majority of banks are well-capitalized and the TARP fund has been declared a "success" by Washington. (They now want to spend TARP funds on other government projects). All of these are good potential signs for the banking industry, except for Washington's desire to keep spending money. The dollar has shown that it is not in a free fall which remains good for the multinational corporations. A low dollar remains a good potential for earnings overseas. For now, these are historically bullish signs for the market.

Note: The above is for information purposes only. Any decision to buy, sell, or hold a specific investment for a portfolio should be reviewed by your personal investment advisor.

Market Showing More Upside Potential

Most of the indexes and stocks we have written about over the past few weeks have undergone a period of selling activity, as expected. These have showed signs of buoyancy with continued rebounds following the selling. Perhaps this is money that has been on the sidelines, or money managers wanting to get in on this huge bull market before year end. Regardless of the reason, we have seen volatile movements which have resulted in good trading profits on both sides of the market.

The Russell 2000 has still not confirmed a new high but is poised to challenge once again. Gold has started to correct after its parabolic rise. The Bank Stock Index is also poised to challenge a new high. Interest rates remain at historical lows. Treasuries are set to rally again.

Stay tuned for more Marketdoc Report updates. You too can learn to recognize important market patterns!

Technical Weakness Continues

This week the market shrugged off news about the debt extension for Dubai West, the state-owned investment conglomerate. As the market fell over 200 points, buyers stepped in and kept things from getting ugly. My guess is these were the last of the money managers and late-comers to the now-nine-month-long stock market rally. They want to show their investors they did not miss this rally before the books are closed at the end of the year.

Marketdoc took profits on some of the short positions which were held for the past few weeks. Rallies as powerful as 2009 will not give up easily and the market rebounded to a new intra-day high on the Dow and S&P. But be careful! The technical weakness we have been writing about is getting more significant. The Russell 2000, Amex, KBW Bank Index, Dow Transports all failed to confirm the new highs which were seen.

The chart above shows all of the technicals on the Russell 2000 exhibiting signs of weakness. We can see this pattern in many other indices and stocks as well. I still am bullish about our economic recovery. However, the technicals are playing a resounding "bass note" and cannot be ignored! I cannot always explain the "why" part. I just know what the technicals show. Marketdoc put back on more short positions this week as the market made its new highs with little confirmation of these other indices.

Note: The above is for information purposes only. Any decision to buy, sell, or hold an investment for a specific portfolio should be reviewed by your own personal investment advisor.