Today the markets were Bull.
1. Thirth consecutive day the SPX closes above 1,228.
2. Nasdaq 100 break the 2,200 level, convincingly.
Today Bull Friday:
But persist many Bear signals:
a) Put to Call Ratio too low, many days in a row.
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b) Dow can't breake the 11,450 level and don't Resolve the flag.
c) Many divergences.
d) Signals of a possible top.
e) The volume has been moderate.
IPC
- Stable day without many changes.
- I'm optimistic about the year close:
-- Target level 39,500
-- Support 37,000
- Still in overbought, that produces the profit take and corrections, maybe not over.
Standard and Poor's
- Resolve up the ascending triangle. Target 1,245.
- 3th day in a row that close above 1,228. Very bull signal.
Nasdaq 100
- Break the 2,200 leve convincingly.
Dow Jones
- Caution. Can't break the resistance and the Flag is not resolve.
- Normaly Dow leads SPX in breaks, the actual situation is unusual.
- These can mean something. Stay alert.
VIX.
- When VIX and SPX closes in green both, the next day probably will be a red candle.
- The VIX Continues searching the low band of Bolliger, when touch it the up trend will have a pause (correction?)
- A formation named Broadening Bottoms is forming. Is bullish 53% of the time. But if broke down, it will take the VIX to very unusual low levels.
Liquidity
¿Why the market continues up, despite all the bear signals?
- The Liquidity Flows is positive. And this override many other indicators, like divergences. While the Liquidity Continues Flowing in the market will continue up.
- Next the chart from Stocktiming showing a very bull landscape:
CPC
- I will not repeat the same (If CPC <= 0.80 probably red candle tomorrow)
- I note what happened when several consecutive days, remains very low. Both the CPC and the CPCE, where the effect is clearer. [This to me is a bear sign, that I do not discard]
Seasonality
- Standard and Poor's 48%
- Nasdaq 61%
- Monday is Statistically Neutral. (Sunday I will have the update for this number for dicember 13th, 2010)
- The next week is statistically neutral. But is "Triple Witching" that turn it bull. (This week is statistically bear and closes up).
"Bear Monday":
Conclusions
- The shor-term and mid-term trends are up.
- The SPX and Nasdaq 100 confirm their respective breaks. Still pending:
-- Dow break the 11,450 level and resolve the "Flag".
-- Many bear signals still valid.
- The market is in bull territory and the conditions for a consistent up trend (Rally)are given. I'm optimistic (bull) for the year end.
- For monday slightly bear. (VIX, CPC and Bear Monday)
-- While the liquidity continues flowing in the market will continue up. But bother me so many bear signals should mean something.
This post first appeared on Mexico Stock Exchange (MSE Or BMV), please read the originial post: here
