The futures were not down for a change and buyers showed up to push SPX higher. Breadth was +60%. New highs and lows were both 13. SPX is just 20 points away from the 50 SMA. That could act as a magnet from here.
The futures confirmed a break of the 100 SMA. The oversold bounce continues for now.
The green count remains overbought, but so far that has not stopped the rally.
This looks like the physics law of equal and opposite reaction. The last break down occurred on 12/14. The high that day was 2635. That would be just above the 50 DMA. I suspect that area will be the ultimate target area for this rally. That would bring SPX up into the lower part of the overhead resistance. So far the sellers are sitting on their hands. That could change suddenly at some point.
The breadth has been very good. The volume ratio of up to down volume is also good. This has caused many pundits to pronounce the bear market is over. I am sticking with the bear market call for now. The market will have to prove the worst is over. The trouble is stemming form overseas and the global data is getting worse not better. I believe people are piling in here because the U.S. economy still looks good. However, there are signs the U.S. is weakening also. Strong breadth rallies do not always end bear markets. There will be some kind of retest eventually. That may end up being a successful retest and off to the races, but it could also be lower lows yet to come. A little patience to let the market sort things out is needed.
Bob
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