$SPX SPY QQQ's, etc break out of sideways channel.

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In breaking out of this sideways channel, the RSI's on the 60min charts of SPY             and QQQ's have pushed above 70 and so are overbought. After the RSI on the 60min charts pushes above 70, one does have to expect a flat market for the following day. Also, $TRIN closed at 0.51 and this too shows a short term overbought situation so more evidence for a flatish market on Thursday. There are a couple of other breadth indicators that pushed into overbought territory and this usually means a pause day for then next session. That's not a negative, just means anyone expecting another big rally day on Thursday may be disappointed. But in this market, maybe not.

Notice on the chart that my two favorite EMA's in this time frame are pointing up, and this is what I've been waiting for, some directional sign. We got that today and I'm expecting that the EMA's as well as SPY/$SPX to begin another leg up from here. Well, I'm not completely convinced of this but I'm going with that until proven otherwise.


JR, don't know what to tell you. As long as the EMA's on this 60min chart are pointed up, then I'm going that way. Could all change by tomorrow morning but if not then the trend is your friend.

With a couple of exceptions, which I referred to in my original post, most breadth indicators are giving neutral readings right now. That could change at any time. I'm watching Zweig Breadth Thrust for a reading over 60 and I'm watching the 5EMA on the $VIX daily for a reading around 12.5. If we should get readings like that from these two on the same day, then I'd start being very careful and be on the watch for some corrective action.

Dopam CurtisM
Good read
Excellent coverage. Been following your post for awhile. Should we still be weary of stocks now that we are entering post earnings market?
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