Stock Market Viewpoint

Stock Market Viewpoint
Reading the Tea Leaves...

Friday, February 8, 2013

S&P New 5 Year High, Nasdaq New 12 Year High

Stock Market Technical Analysis Blog

Click on images to enlarge

In the market today we got the rally the VIX has been telling us was coming for the past three days, with the major indexes closing at multi-year highs.  Those who stayed focused on the VIX and ignored Wednesday night's Bear scare festival banked nicely today. 

Looking at the top cluster first, we see the break out above resistance of the S&P and the continued push down of the red EMA line in the VIX chart. (see this week's Wed and Thurs blogs)

In the middle cluster we see that the S&P broke out of its short term downhill channel today.

In the bottom chart we see the 15 year wide horizontal channel of the S&P with about 35 points to go to complete this up cycle.  Notice by the way, that once the S&P hits the upper channel line it historically trades sideways for about 6 months before the down cycle gets under way.  The powers that be, in back room Wall Street, have demonstrated over and over that they are vehemently determined to complete the up cycle the rest of the way to the upper channel line.  Today the S&P broke through resistance and it favors another attempt to reach the upper channel line.

Trade well my friends,
May the VIX be with you