The State of the Trend

By: George Krum | Sun, Apr 14, 2013
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Last week, based on our analysis of the cyclical behavior of market internals, we cautioned against keeping a bearish stance. On Monday, the tide shifted and now the pendulum has swung the other way:

CIT Dates Chart

The SPX's rebound propelled the index up 45+ points, in line with the average swing size for the last six months:

SPX

This fulfilled our expectation from a month ago, that the index will reach the all time high. This raises again the question of whether the SPX will continue advancing within the confines of the QE III channel, or whether it will kick into higher gear, and aim for the top of the '09 channel.

SPX

Based on our market breadth analysis, the expectation is that overbought conditions will be reached within a day or two, which argues for a consolidation of the recent up move.

In the meantime, the state of the daily, weekly and monthly trend for the DJIA, SPX and QQQ is up.

 


 

George Krum

Author: George Krum

George Krum
www.citdates.blogspot.com

George Krum is the author of the "CIT Dates" blog, and the following apps:

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OT Trend - helps you quantify and forecast the seemingly random ebb and flow of stock, index or mutual fund movement.

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