9:10 AM - Yesterday I was calling for mid 144's. I didn't expect to get it all in one day. At least we are getting back on target, and the market is starting to become more predictable again, even if moves are a hyperbole of what they should be. If I were to expect a game plan, it is to run up the market prior to the decision on the Fiscal Cliff, and then sell the news (maybe a day or two after announcement, after initial high wears off). Don't marry this concept, but that is what the set-up looks like and seems to follow the market's recent history with big expected announcements.

SPX has nearly 75% of issues over it's 50 day average. daily STO has been above 80 for 3 weeks and finally broke under that mark. SPY was not able to pierce the 143.88 (.618) Fib Line yesterday. TRIN closer at .48. We are currently as of the time of writing gapping above our previous close by a significant margin. VIX has a both a bullish MACD crossover and moving average crossover, while VXV is mixed on signals. Sentiment is very ST bullish on stocktwits as well, which rarely helps. All of this suggests a bearish end result today. But, I think it more likely up than down.

Simple answer: Late day parabolic rally with slightly better than average late day volume. To be fair, the overall impression on volume was not fantastic for a breakout, but the breakout did occur late day. Price action alone is very powerful and I would not want to short this wave until firm resistance.

While I do think we will continue to push up, we do have some confines on us. The first is the daily upper BB at 144.50, which also happens to be the high for last week's candle. Do watch that level. If we make it past that level, then there is the new upper channel, which is currently for today at 145.46. I do not see us breaking that level. If we do, it is a head fake and should be sold, regardless of sentiment at that time.

It's about 9:00 AM as I write now and it looks like we are fading some premarket, which is probably good for the long term duration of today. XIV, TQQQ and TNA are all above UPRO, so honestly that is the best scenario for a bull run today.

As always, be mindful of the impact of a VIX spike. I do not expect it today, but the emotional volatility of this Fiscal Cliff stuff, along with a narrowing downward wedge in VIX and a high VIX:VXV rate does add a dimension of risk. If you got in yesterday, watch the levels I mentioned and trade safely. Remember bulls make money, bears make money, but hogs get slaughtered.

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