ALL INDICATORS ARE NOW POSITIVE, GIVING THE "ALL CLEAR" SIGNAL FOR EQUITIES. ACTION IN BONDS, INSIDER BUYING AND ADVISORY SENTIMENT SIGNAL THAT THE BEAR IS DEAD.

COPPER AND OIL ARE SHOWING SIGNS OF TOPPING WHILE GOLD AND SILVER APPROACH A LOW.

Is this rally in a bear market or the beginning of a new bull market rise? The opinions relating to this question have been occupying the media and minds of investors for over a month now. A successful investor needs a discipline to follow to make prudent, profitable decisions. Waiting for the consensus of investment experts and the media to change their outlook will be too late. After all the research I have conducted during my 25 year career, I believe that the long term oscillators and trend indicators (which turn red and green) provide investors with the best tools for making buying and selling decisions. Today the trend indicator for the S&P 500 and the NASDAQ turned green or positive. This follows the action of the DJIA, DJU, and US government bonds, which turned positive on Apr. 7. When all these trend indicators turn positive, a buy signal is issued for equities. I believe that investors turn negative in the future, it will signal that the rally could be over. The past record has shown that it is better to do this than to wait on the sidelines and take the risk of missing out on the dynamic rising stage of a new bull market.

While investors where frightened as the SP 500 dropped to the bear market low of 1,257 on Mar. 17, the update issued the same day was encouraging, showing that the advisory sentiment has reached the same levels as the bear market low in 2002. Since 2000, the shortest rally after this extreme was four months. That would imply that this rally could have at least another two months to go. After January, insider buying also increased to levels typically seen near bear market lows. The week ending Apr. 25 saw the most investment grade bond issuance on record as the spread between credit default swaps and investment grade bonds have fallen by 50%. The technical evidence very clearly indicates that the worst-case scenario for equities has been factored into current prices, which has put an end to the bear market.

Bonds - Government bond prices are in a downtrend as the flight to quality trade reverses and funds move back into equities and corporate paper. This confirms that the appetite for risk is getting closer to normal.

Commodities - These updates have been suggesting that gold prices have been at risk of a decline since Mar. 10, 2008 just before it reached $1,000 an ounce for the first time ever. The price of gold closed at $853 on Friday. Gold and silver have been correcting for seven weeks now along with gold and silver equities and they are now oversold. Copper spiked to new highs today but the action of the oscillators looks very much like they did for gold just before it peaked in March. Last week's update stated that oil had the potential to pause or correct in coming weeks. That is exactly what happened last week.

Currencies - The CAD$ is in limbo versus the USD$. The euro is declining compared to the USD$ and could be peaking against the yen.

Catch the trend.

You can see the small green dot on the far right indicating that the SP 500 has turned positive. To avoid being whipsawed I use many indicators together before issuing a buy signal, not just one or two.

Although it is difficult to see the green dot on this NASDAQ chart, you can see that is not red. In the past, the up trends have all lasted a long time, expect for 2004.

This advisory sentiment chart from Apr. 22 reprinted with permission from Investors Intelligence shows that optimism is increasing after reaching low levels reached during the long term capital crisis in 1998, after Sept. 11, 2001 and the bear market low in October 2002. The shortest rally after reaching an extreme low like this was four months after Sept. 11, 2001.

Government bond prices are still in a downtrend as the appetite for risk increases.

Gold and silver have reached the fully oversold levels but have not turned up yet. This indicates that the worst case scenario is being factored in. It could turn up anytime now. This could happen at higher prices.

Silver prices have also declined along with gold to oversold levels. They should continue to move together.

Gold stocks are also very oversold after correcting since mid-March.

Copper had a spike to record highs today. However, while copper has been reaching higher levels, the oscillator has been hitting lower highs. This is the same situation that happened with gold in March just before it peaked over $1,000. This could be a blow-off for copper, not the beginning of a new rise.

Oil looks to be extended and due for a pause.

The CAD$ is in limbo compared to the US$ at this moment.

The long-term oscillator indicates that the euro is still weakening compared to the USD$.

After being in a long trading range, the euro looks like it could reach another one of it's highs compared to the Japanese yen.

Data supplied by