S&P 500 Bulls Breakout of Range

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The bulls finally gained enough confidence to push the S&P 500 higher to the tune of 2.41% for the week. They were able to break the index through the tightest trading range which had been held for six weeks. It is now up to the bulls to continue the march higher so the bears don’t get any ideas of this past week being a false breakout.

Bear ‘o’ Meter

When we look at the technical data and fundamental data of the markets, the bulls still have a relatively strong grip. The bulls have a nice breakout from this last week to catapult them higher if they can retain control. Now is the time to see if they can make new all-time highs or if they start to peter out.

Above is the combination of all our readings summarized in the Bear ‘o’ Meter. Until we start to get down towards the red, we are going to continue with the longer-term bullish stance.

Index Swings

The swing indexes we like are the following: United Kingdom / Japan / Oil / Extended Treasury / Australia / Brazil / EAFE Value / Global Natural Resources / Global Wind Energy

Most of the indexes made higher ground this week. The big winners were mostly commodities although all the above indexes were up for the week with the exception of global wind energy. Another worth mentioning is the Brazil Index. It was a beautiful set up and performed well when we first entered. Alas, it has come down to our initial purchase range. The good is that it has formed a buy signal on the moving average, so we are going to see whether or not the bulls have it in them to get this index back up and running.

This Week

Many of the markets broke out of narrow trading ranges last week or continued their advance higher. We are looking closely to see if the bulls can continue this current price action and push the markets higher and beyond. If the bulls can’t overpower the bears towards the top of the trading range, it will certainly bring some uneasiness into the markets. We had a very nice buy signal in Switzerland this past week, if we get a trigger, we will certainly start a position.

The Education/Gratitude Book Club

The book for this month is “Misbehaving: The Making of Behavioral Economics” by Richard H. Thaler. Well, it’s been ordered…and I’m assuming it is still in the mail. Gonna have to read fast to keep up! Have a great week!

Warm regards,

Adam Straseske, CMT

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