April 4, 2008: The broad stock market has a much more positive technical background. The intermediate-term indicators are positive and on official buy signals. They had slipped some strength last week but never rolled over to sell signals. Then this week's strong rally brought them back from the brink, and they remain positive.

The SP500 index has, in some respects, become muddled. But its general trend is now up, so that is positive. SP500 index sliced back and forth through supposed support and resistance levels between 1320 and 1340 several times in the last two weeks. Thus, those levels are no longer significant as support or resistance. However, analysis clearly shows a higher high, higher low pattern. This is the sort of thing that is necessary as the first step towards building a lasting uptrend. This pattern remains positive as long as SP500 remains above the uptrend line. On the cautionary side, there remains heavy resistance at 1390-1400.

The equity-only put-call ratios had flirted with new highs at the week ending April 4, 2008, but have since backed off and are trending downward again. Thus, they are on reconfirmed buy signals. These put-call ratios are one of the most trustworthy and long-term indicators. Market breadth has been relatively strong over the past few weeks. Last week's decline was accompanied by only modestly negative breadth. Breadth strengthened on this week's rally and has now moved to overbought status. That is bullish, as long as breadth continues to expand.

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