sp'weekly3 - Keltner
sp'daily7 - fib levels
Copper, monthly
WTIC, monthly
Summary
Another day higher for the main indexes, but that was as expected. Indeed, I am guessing Thursday will open higher, and if we break the recent 1563 high, we could see a brief final burst into the sp'1570s.
Right now, considering the recent 'shaky' price action, and the ongoing horror story in Cyprus, I don't think this cycle can go any higher than the sp'1570s. Certainly, the sp'1600s look out of range for the current multi-month up cycle.
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Both the Fibonacci and Keltner charts are suggestive that by end April/early May we could be trading in the 1470s..perhaps a little lower.
I can not envision any 'reasonable' scenario where the big sp'1400 leve is breached in the near..or even mid term. Whilst QE-POMO continues, the market has a constant bid underneath it.
*I have the small hope that the Fed will cut down the POMO program sometime in July/August, but that remains a 'vain hope'. I have the real suspicion/fear that the POMO nonsense will instead continue into spring 2014, in which case we'll be looking at sp'1700/1800s by year end.
Dr Copper warning of trouble
Despite the continued rally in equities, Copper prices are weak. Yes, Copper rose today, but its still down on the week and month. How we close March will be pretty important for those of the deflationary persuasion.
Meanwhile, WTIC Oil closed higher today, but breaking above the big $100 looks out of range near term. Deflationary bears should be seeking a weekly/monthly close <$90. If that is achieved, then a challenge of the June 2012 low of $77 is back on the table.
Looking ahead
The market will probably see some upside early Thursday, not least if the latest jobs data issued from the Dept of Disneyland Statistics is 'better than expected'.
The more cautious bears could easily wait until next week to consider re-shorting this market. I will try to keep an open mind, and will have eyes on the VIX. Once the VIX floors, and starts turning back up on the daily charts...it'll be time for the bears to come out and play...at least for a little.
Goodnight from London