Daily Index Cycle update

The main indexes closed higher for a third consecutive day, with the sp' @ 1578. We're again just 1.3% from the April'11 high of 1597. It will be critical for the bears to see a market reversal before this week concludes. If the bulls can break 1597, then we would be back in the twilight zone.


IWM

SP

Trans

Summary

So, another day higher, but then, that was broadly as I was expecting. The early morning bounce into the 1570s was indeed as expected, and I took a major short position.

All things considered - not least the weekly charts, I would be VERY surprised, and somewhat dismayed if we break above the recent 1597 high. Frankly, I'd also be surprised if we get any daily closes in the 1580s this week.

Sure, we could open a little higher tomorrow, but I'd most definitely be seeking a close in the 1560s. Further, bears will need a VIX back in the 15s by Thurs/Friday.

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*I remain heavy short overnight, seeking an exit in the sp'1550/40s by the Friday close.

a little more later...