I'm keeping it simple: new highs beget new highs, and both SPX and NDX hit new highs today.
Generally, this is a good principle, but take a look at the SPX - since early 2004, every time it hit new highs, it pulled back, a few of those times quite substantially. That's the nature of ranging, wedging action. And yesterday's falling-out-of-bed was pretty ugly. Probably not a good time, for now, to look too enthusiastically towards the upside.
edit - incidentally, Monday's low of 1258,12 appears to have been a test the upper line of a possible wedge since the Spring of 2005 ("MC's wedge"). That would add some more hegative connotations if that low gets taken out... sonce the action of the past several days would have the look of a typical overshoot of an ED.
I do have a problem with the move since October low ending in such a wiggly fashion, with "threes" up and down.... but, heck, it happens. |
