Another day higher for the US markets, with each of the main indexes setting new post 2009 highs. It remains an incredibly strong market, no doubt partly because of the indirect support via the US federal reserve's 'POMO' program.
sp'daily8 - Ichimoku
sp'monthly7 - Ichimoku
Summary
How long can this new rally phase last?
In my view, its going to be at least another 2 or 3 months until the market will have its first chance at anything more than a 2-4% correction
By late April/early May we could easily be trading in the sp'1600s.
Lets assume we battle all the way to the sp'1650s.
Even a 9% correction..will only get us down to the 1500 level. Just imagine that.. 1500 as the 'new floor', lol
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The monthly chart offers cloud support @ 1200s. Does anyone seriously think we have a chance at breaking down to that level this year?
Frankly, assuming the POMO program continues, I think bears will be lucky to see sp'1400/1350..and that's only if the market gets briefly 'spooked'.
Valentines day (bear) massacre?
We have a major 4-6bn POMO tomorrow. We closed @ sp'1520, and it would not surprise me if we are trading in the sp'1530s.
However, if bears can 'somehow' get this market to close moderately in the red tomorrow - despite the POMO $, then there is again a tiny chance at a retracement. Yet, even then, the 'best hope' is now the 1480/70s, which barely rates as even a moderate drop.
I have my eyes on the metals and the Oil/energy sector. I'll be looking to go long on those within the next week or two.
Goodnight from London
