Outlook for 2013

The MarketBits team wishes all our readers a healthy and prosperous 2013.

As the New Year begins, we now know that the world did not end in 2012; and neither did the bull market that began in March 2009. We had no opinion on the supposed Apocalypse, but a year ago we forecasted that 2012 would be, despite some uncertainty, a generally positive one for the markets. And that is exactly what happened.   

New York had a positive year, as both the S&P 500 and the Dow Industrials spent almost all of their time above their respective 200-day Moving Averages and in rising trends. Toronto and London, frustratingly, carved out large trading ranges for the entire year, but made little headway and refused either to breakout convincingly or to break down in 2012. The aging bull market is long past the point where “a rising tide lifts all boats”, and therefore selection of technically strong stocks, with appropriate stops, was our preferred investment method in 2012, as it was in the previous year.

But how about 2013?

The North American indices entered 2013 on a strong note. The S&P 500 rallied to the highest closing level since the 2009 lows but will need a few more days of positive action to overcome the 1470 resistance.

The S&P/TSX Index reached a four-month high, cleared the 12,500 resistance and got sight of the 12,700 resistance.

Such strong up-moves usually require a few days of stabilization, which would fit well with the 21-day cycle maturing on January 11^th.

Stocks on our BUY lists benefitted from the recent rally and some names have already produced sizable gains in the first days of 2013. 

We just published our outlook for 2013: “A good beginning but is this the year the bull says good-bye?” You can register for a one-month free trial and access this special Market Comment at www.na-marketletter.com