Hello my buddy stock trading fighters. We may well be at the outset of another strong bull uptrend.

Could you repeat that?

What MaryJane am I smoking to say that with unemployment so high, banks being closed down, and home construction taking a double douse to the downside?

Great question. It does appear ridiculous provided you are a one-dimensional life form existing in the present.

But you are bigger than that. You were given the capacity to imagine yourself existing in the future. That higher level of thinking is something that separates you from other beasts and living organisms that can just live in the here and now. Although I acknowledge it is not as awesome as Back To The Future time travel, it can make you a great deal of dinero.

One of the most difficult concepts for amateur traders to seize is that the stock market is the future of the economy somewhere from 3 to 8 months. In other terminology, all the action happening on the stock market at present is a bet on where we believe the economy will be 9 months from the present. The stock market is telling us that in 9 months from now, the jobless rate will be lower, banks will no longer be failing, and housing construction will go back up. The earnings season that just ended confirmed that with 69% of all companies posting earnings increases YOY.

Last week I wrote on the subject of how, with the downtrend channel breakout, we don’t know what new channel or formation will develop because we don’t have sufficient chart data thus far. Currently with 1 week more of data, and zooming out on the stock chart to see the larger pattern, a configuration emerges.

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

Now short sellers and gold insects will protest the chart pattern and proclaim that not enough volume is present for this to be a convincing breakout but this is just not accurate. Provided you travel back in time and study the preceding Bullish Flag breakout we had on the S&P 500, you can witness that the volume that has accompanied this breakout is over 24% more!

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

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

Free stock chart analysis to assist you in establishing the direction of the major indices. Go to s & p trend This article, S & P Trend Upgraded is released under a creative commons attribution licence.