Comments on: Picture du Jour: Stock markets – it’s all about confidence

By: Prieur du Plessis

Prieur du Plessis — Tue, 05 May 2009 18:12:04 +0000

Bill: I unfortunately do not have the Barron’s Confidence Index going back all that far, but a study of recessions and corporate bond spreads since the 1950s show that the spread between high-yield and investment grade bonds typically peaks very close to the end of recessions.

By: Loy Weston

Loy Weston — Tue, 05 May 2009 17:35:59 +0000

I know the R man can change his mind but as a result of his programing, I can’t buy into the secular bottom position until stocks are selling at 7 PE’s and yielding 6 or 7 %, unless he does.

Winston Churchill would say that was a rule up with which he would not put.

By: bill

bill — Tue, 05 May 2009 16:16:04 +0000

How has Barron s Confidence Index behaved during other recovery/bear market phases?

By: Prieur du Plessis

Prieur du Plessis — Tue, 05 May 2009 09:54:28 +0000

Ron: A pullback or consolidation before finally breaking above long-term indicators such as the 200-day moving average. Although a lagging indicator, the 200-day line is often used as an indication of the market’s primary (bull/bear) trend.

By: Ron Glandt

Ron Glandt — Tue, 05 May 2009 09:25:58 +0000

“Meanwhile, the speed and magnitude of the rally argue for markets to consolidate and possibly retrace some of the past eight weeks’ gains prior to launching an attack on longer-term indicators used to distinguish between primary bull and bear markets.”

WHAT DOES THIS SENTENCE MEAN IN PLAIN WORDS? -That it is likely this market will pull back before becoming a bull market???