Friday 4 April 2014

Seeking a weekly close in the 1880s

A moderately lower Thursday close for the US indexes, but with new historic highs being regularly hit, the broader trend remains unquestionably to the upside. Equity bulls look set for a rather strong weekly close, probably in the sp'1880s.


sp'weekly8


Summary

So..we closed a little lower, but this is surely just part of a minor retracement. Indeed, the issue now is how many traders will go long on the expectation of much higher levels across April, and into May?

The weekly charts are clearly restricting the current upside, but by late April, we could easily be in the sp'1910/20s. Monthly charts are offering 1960/70s, but that does not look viable until May.

In May, I still expect the market to hit a concrete wall, the only issue then is how far down might we go? The last two years have seen relatively trivial summer weakness. On balance, I'd have to think the bears have a fair chance of something more significant.


Looking ahead

Tomorrow will be all about the monthly jobs data, market is seeking net job gains of 206k, with a slightly lower headline rate of 6.6%.

*next sig' QE-pomo is not until next Thursday.
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Seeking to go long

Considering the array of new index highs, and the recent utter failure to break <sp'1840/30, I will strongly consider picking up a large long-index block tomorrow. Ideal price range remains 1880/75, some time around the typical floor time of 11am.

Goodnight from London