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The fourth-quarter GDP report was explosive, and confirmed that the S&P 500 is 30% undervalued. However, the market can stay undervalued for a long, long time. There are two confirming indicators that can help you decide when it's safe to jump back into equitiesand when it's prudent to stay out.
There's a lot of similarity between the market's recovery and dieting. In both arenas, progress hits support and resistance levels as motivation rallies and wanes. Charting these changes helps you tap into the underlying psychology of the market and quickly gauge whether you have a hungry bear on your handsor an energetic bull.
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