Stock Market Viewpoint

Stock Market Viewpoint
Reading the Tea Leaves...

Tuesday, June 18, 2013

SPY Pushed Above Resistance

Stock Market Technical Analysis Blog

click on image to enlarge

In the market today the SPY was driven above the resistance line that had been giving it trouble for the past three weeks and closed above it (right chart above).  This move in the SPY brought the VIX to close right down on its lower line of its extension channel (left chart above).  With Bernanke's speech tomorrow this move in the SPY will be a win win scenario to give his speech in.  If he can manage to say everything the market wants to hear and nothing that it doesn't, this move will be called an anticipatory run up to a speech that calmed the market.  If the market hears something it doesn't like and it triggers a sell off, the market already has a few days of air cushion below it to cushion the blow if the sell off becomes serious.

If Ben's speech calms the market then we are likely to see the VIX finally fall out of that steep ascension channel which is just what the bulls are looking for.

Trade well my friends