10am update - a long weekend ahead

Good morning. Mr Market seems exhausted. We've had a very strong 86pt gain on the sp'500 over the last 14 trading days, and with the VIX in the low 13s...you'd have to believe a retracement is coming sooner, rather than later.

The natural levels would be...

sp'60min4

vix''60min

Summary

I'm not expecting anything significant today, but its a reasonable day to re-position.

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I'm looking to pick up a VIX call block sometime today.

Having exited VIX @ 22.25, going back in at this level seems pretty 'fair' on any basis.

Seeking a spike into the low 16s at least.
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Flying above the clouds

With the indexes higher yet again, and taking out the important sp'1474 high from last September, the market really is starting to fly now. There is plenty of empty air into the low/mid sp'1500s, and even the looming threat of another debt ceiling argument doesn't seem to be bothering Mr Market anymore.

Lets take a rare look at the SP'500, from above the Ichimoku clouds.


sp'daily8, 1yr

sp'monthly7, 10yr

Summary

I should note, I post the above charts merely as a curiosity than anything else. I occasionally see other posters highlight the Ichimoku cloud charts, but its not something I am at all well versed in.

The monthly chart is somewhat more interesting, in that is does show how there was ample warning of 'trouble ahead', when the cloud was first pierced in July 2008.

You can see that right now, the cloud is way down around sp'1125.

So, in theory..even a very large 20% market fall of 300pts would NOT break into the cloud..and cause any major bearish warnings to trigger.

We are in an incredibly strong market, one that is able to sustain a major 20% decline..and still be outright bullish!

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*market is closed on Monday, so we have a long 3 day weekend ahead.

Goodnight from London

Daily Index Cycle update

The main indexes closed around 0.6% higher, with the Rus'2000 and Transports leading the way higher. With the break over sp'1474, the provisional bullish warning - from the trans/R2K, was confirmed, and it would seem there is a considerable way higher yet to go.

With today's break >sp'1474, Its probably useful to consider all of the six main indexes.


IWM (rus'2000)

Nasdaq Comp

Dow

NYSE Comp

SP

Trans

Summary

So, we have the Rus'2000, Trans, NYSE Comp, and now the SP'500 above their highs from Sept'2012. Only the Dow and Nasdaq are yet to make the break, and the Dow could easily do that tomorrow.

More than any other chart, the Transports daily is becoming ever more impressive. Day after day of gains..scraping along the upper channel line..and on its way to the next big psy' level of 6000. As I noted the other day, are we looking at Trans 7k end 2013, with SP'1700s? It has to at least be considered, even by yours truly.
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Underlying MACD cycle on most of the indexes is certainly weaker than it was, but its still positive cycle, and generally..everything really does look outright bullish.


A retracement?

A retracement is of course very viable at any point, and indeed, the higher we go, the more closer we are to getting one. Yet, even a pull back to sp'1450/40 now looks somewhat difficult, and the lower gap of sp'1425 looks arguably out of range.

Frankly, it could be a very considerable time before we fill that gap @ 1425.

A little more later.