Pre-market update (updated 8am eastern):

  • European markets are trading just 0.1% higher.
  • Asian markets traded 0.6% lower. 
  • US futures are trading flat ahead of the bell. 

Economic reports due out (all times are eastern): MBA Purchase Applications (7am), ICSC-Goldman Store Sales (7:45am), Housing Starts (8:30am), Producer Price Index (8:30am), Redbook (8:55am), FOMC Minutes (2pm)

Technical Outlook (SPX):

  • Another solid day for the markets, where we close at new recovery highs. 
  • A slow & steady churn higher after another initial burst in the first 15-20 minutes of trading that comprised of most of the day’s gains. 
  • Evaluating the 30-minute chart since 1/7 reveals a market on a not stop push higher with minimal pullback and a near perfect up-trend. 
  • SPX has closed 33 out of the last 34 sessions above the 10-day moving average – a very difficult feat to pull off, but shows the strength of the current market. 
  • Much of the rally, outside of the initial burst on 12/31 & 1/2 has been marked by a drift higher rather than rampant surges and large gaps higher. 
  • A break of 1495 is absolutely key in this market to get the bears motivated. 
  • Volume seems to be picking back up in the market. 
  • VIX closed at new 5-year lows. Possible that we see 11’s in the coming days. 
  • The only direction that can be confidently traded is to the upside. 
  • A pullback to 1475 would likely satisfy as a pullback to the lower rising channel, and be considered healthy for this market. 
  • More than 60 days have passed since we’ve seen a 5% pullback in the markets.
  • Only one day in the new trading year that has resulted in us closing down more than 1%. 
  • There’s not much in the way overhead resistance that will keep this market from hitting all-time highs from a technical analysis standpoint. 
  • The channel that we are currently trading in looks very similar to the channel that we traded in last year from June through September. 

My Opinions & Trades:

Chart for SPX:

S and P 500 Market Analysis 2-15-13

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