Is Now The Time To Consider Stock Market Investment?

We all know that successful investing in stocks is not just about finding some great company that can grow in years to come.  It is about, what we in trading call, proper timing - choosing the best time to get in and get out.   So, is now a good time to invest in stocks, or would it be wiser for potential investors to still wait and sit on sidelines?

Looking at fundamentals and macro economical picture, periods of time when interest rates are at low levels have almost always been very kind to the stock market.  And since present interest rates are at historically lows, that alone presents a valid assumption that the equity market will go up in the near term future.  Furthermore, latest housing number statistics show drastic and unexpected improvement which may be a valid signal that the worst of economical turmoil is over.  That is exactly the major reason behind recent market advanced of over 2% which is a clear indication of return of optimism.

 Additional confirmation can also be seen on a technical side of market analysis.  Dow Jones Index has in the month of November retested yearly lows of under 10,700 on two occasions.  However, on both occasions, it has swiftly bounced off those lows and thus created a valid support line at that level.   Furthermore, its most recent data show that the index crossed its 200 day moving average which is additional confirmation that the uptrend is possibly resuming.   Since its first major resistance is not seen below 13,000, the possible move presents a decent medium term profit potential. 

Long term investors will also be happy to know that with the financial crisis on the Wall Street behind us, the US is expected to show further improvement.   New statistics predict economical growth of more than 2 % as was seen during the last July-September quarter.  So, yes, now might be a great time to invest in stocks before the market moves further to the upside.