On borrowed time - 13 March 2013

The S&P500 turned bullished earlier this week.
That perhaps sparked a couple of friends to start asking for opinions for how this market is going to move for the rest of this year, and if they should join in to ride the trend.

This analysis is for you all...

SPX (S&P500 Index)

The Monthly chart on the left shows a 3rd wave in a 3rd wave (for those who are into Elliot Wave theories). Even if you are not into Elliot Waves, what this indicates is simply that the trend is t-r-end (Turning Round the End). It is a mature trend in a monthly chart, which means that the technical outlook here is longer term (in months). The MACD is flashing that this trend is mature. And current prices are near the mania upper band. Notice how the previous four times over the last 3 years has a pullback happen when price is near or at mania?  The count leaves only 1-4 more bullish candles, and I suspect perhaps we would see two more bullish months at the most, and may hit the last 2007 high resistance level or just fail it.
Therefore, while it seems bullishly trending, it's a bit late into the party IMHO.

The Weekly chart on the right shows it is still a bullish tone, but the prices are at mania levels. There is no Sell signal yet, but you can see how far off we are from the Buy signals. Nonetheless, it's still bullish - at least for now.

The Daily chart above (right panel) shows the Volumes (from ES futures) and this last rally has drooping volumes. Again, I'd say it is undeniably bullish for now, but pretty much just about there and I'm looking for the turnaround soon.

The MadScientist

13th March 2013

Note: ALL material posted here is from my personal opinion, and my opinion may differ or change without notice. These do NOT constitute as solicitation, investment nor financial advice. By reading the materials presented here, Readers acknowledge the awareness that the materials are intended for educational purposes only. For investment(s) advice, related decisions and/or actions pertaining to investments, always consult your own qualified financial advisors, brokers, etc.

Charts are from TD Ameritrade Thinkorswim platform