There's not much point to making New Year's resolutions prior to Super Bowl Sunday.
Think about it… Super Bowl Sunday is a day for beer, tortilla chips
and seven-layer dip, cigars, and yelling obscenities when your team
makes a stupid play. Who wants to go on a diet, give up drinking, stop
smoking, and cut out the foul language prior to that annual celebration
of bad habits?
It just doesn't make sense. So I always wait until after the Super
Bowl before getting to work on my resolutions. And it usually works out
Last year I resolved to try to be more open to the bullish side of
the stock market. My natural inclination is to lean bearish. I don't
trust the stock market. I suspect there's way too much manipulation
going on. And it would be a nice change of pace to put on some of those
rose-colored glasses everyone else is wearing and look at the market
through bullish eyes.
But I couldn't do it last January. I looked at the market and this is what I saw…
This is a 60-minute chart of the S&P 500. It displays a
long-term bearish rising wedge pattern with negative divergence on the
MACD momentum indicator. It's a bearish chart pattern and almost always
ends with a significant decline. I wrote about it a few times as it was
developing, most notably here
There was nothing bullish to see here. So I put off starting on my
bullish New Year's resolution, just like I put off all the others, until
after the Super Bowl.
Here's how the S&P 500 looked on Super Bowl Sunday…
Just as it was easier to start a diet once the gluttony of football
season ended, it was far easier to stick with my bullish resolution
once the bearish pattern of the rising wedge had played out.
And now, as we enter 2011, I'm once again finding myself wanting to
try to be bullish. Let's face it… I've been cautious lately. I'm
worried about risk. I suspect there's even more manipulation happening. I
wish I could put on those rose-colored glasses everyone else is
But when I look at the market this is what I see…
Maybe I'll wait until after the Super Bowl to make this year's bullish resolution.
Best regards and good trading,