Interestingly, the S&P cash has bounced 119 point in the last 4 weeks. On December 19th, we posted a low at 1203. Today’s high so far, has been 1322.
S&P cash is up at a long term trend line resistance today. Three points of to connect: First 1) High on 5/2/11 at 13.70 Second high 2) 7/7/11 at 13.56. Third intersection today at 13.16…. I’d sell this here and risk 5 points heat to the upside… down side target? 13.00 and then 12.80…
This is a good counter trend position. CNBC will be squawking today about the 6-month high in S&P.. That has to be an initial fade.. It just has to be..
I mentioned that I felt we would rally in the face of popular negative feeling from the general public, as well as the “hedge fund gurus” profiled in the WSJ, NYTimes and other publications at the start of the year. I would mention Barron’s, but Barron’s has been bearish the stock market since 1982, so they have to be discounted as perma bears.
Upside targets? Try 1347 and 1356, followed by 13.70. 13.70 was posted in April of 2011. That was the highest level seen since June 2008, 3-1/2 years ago!!
If we watch GOP tear each other apart, then we have 8 more months of Dems and GOP tearing each other apart, we should easily climb this wall of worry.
This is a good trade to fade, short term.
AS ALWAYS, I’D HAVE PROTECTIVE STOPS.
CER.
THAT IS ALL FOR THIS MORNING