Today's chart brings up a few questions: for one, is today's close a break of a resistance level, and are we now in a new range? If so, then my initial target of 1250 may be in question, and we may now be headed for the 200dma (if we do get to 1250, I will be selling there, as that would represent a substantial profit and I don;t want to risk giving most of it back). Volume dropped again, and unless that picks up, I don;t expect this to get past the 200dma. We are seeing a pretty decent rise in CMF and RSI is now above 50, so unless something happens in the news, I see pretty clear sailing until 1250.
The Nasdaq also just barely broke out, but is a lot closer to resistance at 2600, and this may struggle to get higher. however, the price relative line is now moving up, so if the SPX moves up, so will this.
The Dow is still under the previous high, and the price relative line is now moving down. As strange as it may sound, those are both bullish for the rest of the market.
The price relative line on the Russell 2000 is also moving up, and today it was way out in front of the big caps. this has a gigantic air pocket from where it is now to the next resistance level, so if this continues to outperform the SPX, then we have ourselves a rally.
This week will be significant in pne aspect: low volume, as is typical for the last couple of weeks of August. It usually isn;t until after Labo Day that the big money boys are back in town, and that is probably why September has such a horrible history. Last September Bernanke pushed the QE2 button and turned it into one of the best month of the year, but i have severe doubts he can do that again.
I will have the new highs update shortly.
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