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Thursday, February 9, 2017

Daily update 2/9

The market liked the talk that a tax package might be forthcoming in 2 to 3 weeks.


SPX makes new all time high and closes above 2300.  Breadth was +62%.  New highs increased to 156.  That is about half the new highs we had on 1/25.  There might be a rising wedge pattern forming since the 12/13 peak (marked by the red lines).  Today SPX hit the trendline formed from the last two peaks.  Whether that causes a pullback or not remains to be seen.


The futures broke above their prior overnight high.  Should they fail here there would be a possible double top.


The green count eclipsed 50 today.  The red count reached the lowest level since 12/13.  Still not overbought.

There is zero selling pressure in this market.  The most interesting thing I heard today was some guy on CNBC in a tease for an upcoming segment asking whether people should abandon the practice of waiting for the dip to buy stocks.  I missed the actual segment so I do not know what was said.  The fact that they were even asking the question in the first place should be scary for bulls.  Several years ago John Hussman showed a chart with an idealized bubble pattern showing ever smaller pullbacks.  If the pullbacks got any smaller these days they would not exist at all.  This all seems surreal to me at the moment.  I have no idea how much further up we go.

Bob

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The information in this blog is provided for educational purposes only and is not to be construed as investment advice.