Launch, but.
SPX made a new closing high by 2 points. Breadth was strong again at +63%. New highs increased to 212. Not a very strong launch considering the setup. SPX did not even close above the 7/20 high. The next two charts are where the but is though.
While SPX made a new closing high the futures failed to clear the 7/14 overnight high. This is a good example of how those overnight extremes sometimes become strong support or resistance. Another part of the but is the futures did not do enough to get a green price bar.
The green count barely moved and remains below 50. That is another part of the but.
The dollar index followed through on the break out the other day. This looks headed to test the highs at 100 to me.
The bull case of the dollar going down and oil up is falling apart. The other part of the story was earnings are beating expectations. While operating earnings are probably going to do just that some high profile companies have missed badly on GAAP earnings. You know the actual real earnings, not the fictional made up stuff. What happens next week? I guess that would depend on whether the resistance in the futures is still there. The technical strength has waned so much this could be a short term top without particularly high odds of a retest. If we get a pullback from around here I would still expect support in the 2130-35 area.
This is a rather interesting chart.
Source
The last two bull markets got well ahead of what the economy could support and ended up in 50% meltdowns. It looks like we are there again. Will it be any different this time?
The market and sector status pages have been updated. Have a great weekend.
Bob
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