A post we wrote yesterday after the market close noted the similarity of the S&P's recent market pattern to prior chart patterns. One market technician I follow is Charles Kirk of The Kirk Report. I have found Charles' technical analysis as some of the best. I am summarizing here; however, he believes chart patterns provide important insight into the market's near and long term direction. Today he linked to our article from yesterday and made the comment to his readers to note the recency bias in our analysis. At HORAN we do believe investors should be aware of the recency effect in there investment decision process. Absent from yesterday's post was a discussion on the longer term view of the market. In that regard, below is a 5-year chart of the S&P 500 Index using a weekly view. It is our view that the market remains in a bullish posture on a long term basis as well. Certainly, short term volatility is likely to influence near term price action, but our view is the market can continue to grind higher, even from these levels, all else being equal.
|From The Blog of HORAN Capital Advisors|