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Hi guys, I hope you all had a restful weekend with family. I will resume the Sunday video next weekend.
I didn’t trade on Friday and it felt more like a week than a day. The S&P finally managed a close above the all important 200 day moving average. The most important level to keep your eye on now is the high that was put in on Oct. 27. That would be the 1292.66 level. My belief is that level has a really good shot of being reached, and if it gets broken we may see a move to the 1320 level. So maybe another 50-60 points could be left to the upside before we get a sell off. Europe has been behaving and that has helped our market, so let’s hope that can continue a little bit longer.
The market has absorbed all bad news well lately and the bears seem uninspired at this point to stop anything. As you can see below even though the euro is still horribly weak, the market moved higher. Keep in mind that dollar has leveled off, but by no means is showing any real weakness. It just appears we are in the Santa Clause cycle and stock truck higher no matter what.
If the Santa Clause rally extends, that would take us into the second week of January. It’s not a perfect world, so that may not happen, but so far it is holding true. I will update you on setups as the week progresses.
Have a great evening.