Daily Index Cycle update - mixed signals

The main market did close broadly higher today, but there were a few minor signs that things are getting way over-stretched/exhausted, most notably in the Rus'2000 small cap index. The R2K is often the craziest/most volatile index, usually leading the way..both higher..and lower. Today though, the R2K closed marginally red.

What is clear though, there is not even an initial sign of a turn lower yet, with the VIX supporting that view.


IWM, daily3

Sp, daily5

Transports

Summary

Transports saw a significant break higher in the morning, the sort of move the bulls will need in the days ahead. After all, the bigger monthly/weekly cycles are still a problem, and the bulls have to keep pushing higher, or the bears should (in theory) be able to seize downside momentum back.

The sp' similarly remains in an uptrend, only a break below the lower channel of 1350 would be the first sign of trouble. Upper channel resistance is around 1385/90.
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Recommended reading - a good posting on the VIX from Zerohedge, a pretty fair viewpoint on the current latest bout of deluded lunacy that is 'the market' that we still try to be a part of.

To be clear, unless I see a few closes over sp'1390, I'm still clinging onto my broader bearish outlook, but we are getting down to a buffer zone of 10pts or so. The big bearish summer 2012 outlook..is indeed on the edge of being thrown in the trash bin. Maybe thats a sign the top is in? Urghh.

A little more later.