When a market breaks out over critical down trend line resistance you'd like to see that breakout occur in a forceful way that's convincing. A breakout that allows the bulls to feel confident going forward. You would like to see the breakout be at least a half percent if not a full percent above the breakout level. Since 2075 was the trend line I'd like a minimal close at 2085 if not 2095 to feel confident the breakout is for real. So yes, we have the breakout on the Sp but it is tepid at this point in time. Maybe by early next week the bulls can celebrate with a forceful move but until we get that move higher it's best to respect what has taken place meaning it's fine to remain bullish but don't get overly complacent. The bears still have a fighting chance to take this breakout back but they need to act quickly as each day we stay above 2075 we'll see the bulls get more confident. If the bulls can hold this over 2075 with force in the days ahead then the market likely has a date with an old friend, 2134, or the old Sp high from last year. The bears have failed at many resistance levels on the way up but none were close to being as important as the trend line breakout level of 2075. While they've failed to get busy in the past to prevent higher prices, they better act now or they're going to have to watch the Sp go to 2134 and beyond. That's the very last thing they want to see take place. It's now or never time folks. Next week will tell the tale. Exciting times ahead for everyone as we get what we've been waiting for.
When a market breaks out over critical down trend line resistance you'd like to see that breakout occur in a forceful way that's convincing. A breakout that allows the bulls to feel confident going forward. You would like to see the breakout be at least a half percent if not a full percent above the breakout level. Since 2075 was the trend line I'd like a minimal close at 2085 if not 2095 to feel confident the breakout is for real. So yes, we have the breakout on the Sp but it is tepid at this point in time. Maybe by early next week the bulls can celebrate with a forceful move but until we get that move higher it's best to respect what has taken place meaning it's fine to remain bullish but don't get overly complacent. The bears still have a fighting chance to take this breakout back but they need to act quickly as each day we stay above 2075 we'll see the bulls get more confident. If the bulls can hold this over 2075 with force in the days ahead then the market likely has a date with an old friend, 2134, or the old Sp high from last year. The bears have failed at many resistance levels on the way up but none were close to being as important as the trend line breakout level of 2075. While they've failed to get busy in the past to prevent higher prices, they better act now or they're going to have to watch the Sp go to 2134 and beyond. That's the very last thing they want to see take place. It's now or never time folks. Next week will tell the tale. Exciting times ahead for everyone as we get what we've been waiting for.
So if we break out over Sp 2134 we will have to deal with the worst divergences on those monthly charts that you will ever see. It doesn't seem as if it will matter. It should though. They are so bad it's almost impossible to accept that they won't matter but the power of the central banks are so powerful it is possible they won't matter. I wouldn't count on it but we may be finding soon enough. It would be great to find out if technical analysis has changed that much. It has already changed quite a bit but this would be amazing beyond words. That said, we still want to see a strong close over 2075 to set the ball in motion for a move to the next resistance level at 2104. 2116 follows that and then the big one or the old highs at 2134. 2075 remains all that matters as support on a closing basis. While we are long I want it known that I am nervous based on those enormous negative divergences. Day to day with next week likely giving us resolution.
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Peace,
Jack Steiman
Robert New
