From a psychological and price perspective you have a lot of shorts trapped under 40400 and 1760(SPX) with a market in max pain mode, not letting shorts out and up to fast for those stopped out to get back in. General feeling, nothing quantifiable, is a lot have missed out on this recent rally and when that happens a continuation is normally on the cards wrt price. I'm short for a trade but I see new highs bar any significant event.
The way it seems is that the rally that we've see over the last days goes well beyond a dead cat bounce - the bulls have regained control of the markets and have survived e.g. dismal employment numbers and the testimony of Janet Yellen yesterday.
The short-term trend now appears to be aligned with the long-term uptrend favouring a continued move towards the recent high at 42600.
the SPX it now very overbought. Such negative divergence should ensue from today's higher high and I am targeting a pulback to 1800 (+- say 05 points) as a level from wh to go more realistically forwards to mentioned previous highs on SPX and our T40 as well. But as you know the markets can remain overbought for long times. -
this is on price technicals only as I fail to see the supporting fundamentals to sudden return to 'normal bullishness' considering the macro picture high P/E's obstacles to earnings not priced in , election year clowning in half the globe, etc. maybe someone needs to tell me the forward positve picture I am obviously missing ?? is this just a blow off top perhaps? or just Feb/March top forming?
