Similar, but different

I want to compare the most recent market action with the pullback that happened in Nov. 2010.

 Look at the difference in the initial moves off the lows.  In the first one, we had two big up days that cleared most of the price action to the highs.  In the second case, the first two big thrust days still had a lot of days of price action above to get through.  The 2010 high was a spike up then a sell off.  The most recent high had a couple of weeks of chop before the sell off.  This created overhead resistance that was not there in the 2010 pattern.  This is why I wrote on 4/26 "SPX has moved up into the middle of the trading range from back in March.  It looks like we have cleared a major hurdle today, but there still could be some overhead resistance up here."   Now lets see what happened after the thrust.

Even though the initial launches in both patterns looked good, the end result was completely different.  That had everything to do with the pattern going into the high.  Even the better then expected ISM report that caused the spike up in price on 5/1 was not enough to conquer the overhead resistance.

Bob