Hey all, happy Friday. I just wanted to quickly regroup with you before we all got started on our weekend plans to give you an update on the bullish reversal call... the one we've been talking about since Wednesday. In simplest terms, we got some more clues today that jive with the new bullish opinion. Advertisement Complimentary Stock Analysis Should you buy, sell or hold? Enter any stock symbol for a free, complete technical analysis from INO.com. This report will be delivered to you instantly! --- Today's Top 50 Trending Stocks This dynamically updated list will share today's top trending market movers to help you find realtime trading opportunities. Advertisement When we left off Thursday, the basic gist was that the sellers were running out of gas. In fact, Thursday's strong selling effort felt like something of a last hurrah for the bears, at least in the near-term. All it took was a touch of that 38.2% Fibonacci retracement line. Well, though stocks made a lower low today, as I kind of suspected would be the case, there's not much selling interest left to tap. The major indices are back to break-even levels or better, pushing nicely up and off Friday's intraday lows. And it's the intraday bounce that puts the icing on the rebound cake. I know we don't get to talk to you much about this kind of stuff, but the shape of the daily bars for the market and individual stocks can tell you a ton about what traders are thinking, and where a stock or index is apt to go next. You've probably heard the term 'candlestick analysis' before; some of you even probably do it on your own. For that reason I'm not going to preach on it today. I'm just going to use the underlying philosophy to describe why it matters with what's going on right now. See today's bar for the NASDAQ 100? Assuming we close where it's trading right now (around 2509), that will qualify as a doji bar.... where the open and close are right at the same level. The equal open and close, on their own, indicate indecision from the market. To see equal opening and closing levels on a day with a 'long tail' though, where the low is a much greater distance from the close than the high is, suggests the sellers tried to push things lower, but simply ran out of gas (or ran out of numbers). That's how the index made its way back up to where it started the day. So far so good? Great, 'cause this is where it gets a little heavier If you take a step back and look at this idea philosophically, what you're really seeing with today's bar is the last of the would-be sellers being flushed out, and the first of the would-be buyers starting to trickle in. More will likely follow if the market can just get a tad more traction early next week. In other words, long-tailed dojis tell you there's a transition likely in place, which in this case is a bullish one. To see it happen (1) when stocks are oversold, (2) after an important Fibonacci line was touched, and (3) after a merciless blowout/capitulation day like yesterday only bolsters that bullish argument. Yes, things could change between now and the actual close, so take it with a grain of salt. On the flipside, we rarely see much net movement on a Friday afternoon. Like I mentioned to you yesterday, you may still want to stagger your long or bullish entries. But, there's just too much upside reward compared to any remaining downside risk to overlook now, in our collective and humble opinion. Just keep in mind the shape of today's bar could change between now and the end of the day. The closing price is really the only one you want to worry about, so check out the NDX after 4 pm EST for the bottom line. The Market's Actual 'Value' Now in Sight Ya' know, I started thinking about this yesterday, but didn't have the time or data I wanted to do the idea justice. I do today though, so here goes. The last three (dismal) weeks for the market got me thinking about one of the most empowering axioms out there for investors. It was Benjamin Graham who first noted "In the short term the market behaves like a voting machine, but in the long term it acts like a weighing machine." By that, he just meant that given enough time, stocks reflect reasonable and fair values. In between those times though, hysteria, fear, greed, misconceptions, and a hundred other things cause people to make buying and selling decisions that have nothing to do with - and don't affect - a company's or a market's earnings. I bring that up with you today to let you know the selloff over the last three weeks isn't a "weigh" - it's a "vote", or a short-term move based on some errant assumption, and driven by over-reactions. Oh, to be fair, the ridiculous rally during the first quarter of the year was also a "vote"... just in the other (bullish) direction. The truth and fair value for the market right now is somewhere in the middle of those two extremes though, and I've got a feeling it's going to take the rest of the summer for stocks to find the right 'value' groove again. The good news is, the market's worth at least a little more than where it's trading right now. The proof? Not that the folks at Standard and Poor's are always perfect, but their historical data is what it is, and their forecasts are pretty much on target. Well guys and gals, the historical data says the market's (S&P 500's) trailing P/E is 13.3, which is on the VERY low end of a 25-year range. And, the S&P 500's is on pace to reach record earnings levels in Q3 of this year, and is expected to hit record earnings through 2013. I know there are some risks, and I know that S&P didn't exactly see the 2008 implosion coming from 20 miles away. Standard & Poor's did catch on pretty early in the recession's timeline though, so I'm more inclined to trust their forecast than not. (S&P's research is far more holistic than most investors may recognize.) Advertisement Santa Monica Wiz Kid Makes $87 Million Trading Stocks Using his same strategy you can get crazy rich - fast! One trader recently used this strategy to increase his wealth 4-fold in a single weekend. Find out how you can do the same thing! Click Here and Find Out How - for FREE! Advertisement What's it mean for you? Well, for short-term traders, not a lot. For your long-term investor side though, my fear is that the media is spooking you into a long-term bearish opinion which just isn't merited. In the end, the market's a 'weighing machine', and the long-term scales still say stocks are undervalued even if we know we're not going to instantaneously reach those fair values. Alright, getting off the soapbox now. Everyone have a great weekend.