Weekly market commentary from Larry McMillan:
SPX Through 12-11-09
Despite some selling this week, support at $SPX 1080-1085 has once again held, and therefore the overall bullish trend of the market persists. Some of the technical indicators have weakened, but as long as that support holds, they are not important. On the upside, the resistance at 1110 remains in place as well.
Our breadth oscillators have given six separate sell signals over the last month, as $SPX has been unable to break out on the upside. That is certainly a negative sign, and those sell signals remain in place today.
Equity-only put-call ratios have been unreliable ever since heavy hedging activity began last summer. That activity seems to be abating now, so we are tentatively looking to use the equity-only ratios as trustworthy market indicators again. They, too (like breadth) have generated sell signals this week.
VIX Through 12-11-09
Volatility indicators are more positive. Volatility indices themselves ($VIX and $VXO) continue to decline, and that is generally bullish for stocks.
In summary, both bulls and bears are frustrated — and will likely remain so until a breakout occurs.
0 Responses
Stay in touch with the conversation, subscribe to the RSS feed for comments on this post.