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Tuesday, April 1, 2014

Daily update 4/1

A slight new high close on SPX.  Here is the daily chart.

SPX finally got up through the .786 retrace line with yet another big gap up.  It is now resting on the bottom of the uptrend line from earlier in the rally.  I don't know if that line is important or not.  We will find out in the days ahead.  It was another light volume day, but heavier then yesterday.  Lets take a look at the new highs and lows chart.

SPX has made three spikes up over 1880 including today.  Each spike was met with a lower number of  new highs.  That is normally what happens at tops.  Check out the Russell2000 and COMPX charts.

On the first attempt at 1880 the Dow was the only important index lagging behind.  That one is getting close to a new high now, but the Russell and the COMPX are both lagging.  These two may be a bigger problem then the Dow lagging was. Can SPX hold at the highs and push higher long enough for these lagging indexes to catch up?  Stay tuned.  Here is a peek at the 60 minute SSO chart.

A last spurt at the end of the day pushed SSO to a slight new high for the day.  The earlier high was right after 10:00.  That has been commonplace with SPX above 1870.  Either the market sells off or finds its high shortly after 10:00.  Very strange price action.  It looks to me like the market really struggles to go higher above 1870.  We will see whether that condition persists or not.

The next couple of days are going to be real important.  SPX has to push higher or be in jeopardy of making a triple top and selling off.  Will rally chasers show up?  Sometimes it is easier to get to a new high then it is to stay there.  With the low number of new highs and lagging indexes this may be one of those times.  I will be watching for a close below that SPX 18 DMA (1863) for a sign we are reversing. 


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