FX:SPX500   S&P 500 Index
Since mid-February, the broad market has been in a virtually unrelenting upturn, with traders constantly saying to themselves: "This is looking weak here," "This has gotta be the top," "Looking extended," ya da, ya da. Unfortunately, the SPX             has not yet obliged the bears to any significant degree, and I imagine that they are again saying to themselves here: "Oh, look, that long-term channel has broken!", "The moment has arrived!," "All bears, rejoice!"

As one of the traders in the Stock and Indices room likes to say: "Not so fast there, cowbody ... ." And I would tend to agree.

If you look at the 4H chart here, I've been busy doodling away with channels while I wait for "the fat lady to sing" the end of the protracted uptrend. Although most of the price action has been testing the upper bound of the long term channel, it's finally broken the lower bound on pre-FOMC sideways price action. Why am I using bold italics for "on pre-FOMC sideways price action"? For the very reason that I inherently distrust trend or channel breaks that occur because of sideways action; they don't mean the trend is over; they merely mean that price is pausing here, and that it's paused for a number of candles.

For me, the market's pausing gives me reason to pause as well; let the market fully digest FOMC (and now, the BOJ) before adding additional positions. In my particular case, I'm looking for weakness to add more long delta via short put credit spreads, having piled in a bit heavy on the call side on this strength.

So, no, we're not there yet. Keep looking out the window and enjoying the view ... . (And no, we're not going to stop here. I told you guys to go to the bathroom at the last rest stop we took a half hour ago.)
Comment: For the time being, respecting the low bound of the purple channel after testing the upper.
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