As long as we do not have a collapse next Monday and Tuesday, we will end February with a gain. I also suspect that we will have no change in the monthly setup either. This past Friday, all 4 indexes did some crazy things. Let’s get to the charts.
The S&P 500 daily hit another all time trading high and closing this past week. The DMI is also very positive to the point that you would begin to think it is over cooked and a cool down is coming. Volaitilty is till low, so there is nothing pointing to a pull back yet. No one can predict when these type of markets will slow down, so I will just let my charts talk to me and let the TV talk to all the others. The thing you can’t see on this chart is how the S&P 500 ripped higher the last 42 minutes into the close Friday. Price went from a loss for the day to a gain. It was a rip you can see Here. Something or someone is driving this market and does not want to see a pull back yet. We ride.
The Small Cap also hit a new all time hight this week but faded all week after that. Thursday and Friday price opened down in chunks and buy the end of the day, it had recovered a bunch, but not enough to make it a positive week. It was a small loss, but a loss. The Small Cap is still up over 2% for the month, so it’s hard to be upset at that. DMI is still positive, but it does appear to be under pressure. Is this a sign we are slowing down? To hard to read and it’s too early to call that. We ride.
The International was looking really good separating itself from that old resistance line and then bam, we had to test it again Friday. Friday morning, price opened right on top of the resistance line and then proceeded to march back uphill the entire trading day. Price did not make it back to positive for the day, but still stayed on course. Remember that short term uptrend line I drew last week? It’s still working. Volatility did jump up a little this week and that is a concern. The DMI is still positive, but is showing signs of strain. Price will need to continue higher next week or that short term uptrend will be in trouble. We still ride.
Well, well, well. Bonds fired and confirmed a daily buy Thursday and Friday. Is this a sign that big money is running to safety before a pull back in the market? Time will tell us, but it is way to early to know for sure. This is only a daily buy. I have mentioned more than once that I thought a bottom had formed and all indicators had merged into a tight pattern, so this buy signal is not surprising. I can tell you after looking at the weekly and monthly charts, that we are not even close to a buy signal. So this call for an early enter might be on the money and it might be just a head fake. For now, I watch and wait.
Conclusion: We have 2 more trading days until the end of the month. I will post the monthly moves as quickly as I can Tuesday night, but I am expecting no changes. So I will be riding this wave for at least another month.
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