And the rally continues… the S&P 500 and the Nasdaq 100 have pushed to new all-time highs. Dow 20,000? No idea, I don’t watch that one…but probably there today.
The VIX is down to 11.29, on pace for the lowest close in a couple of years. The VXST, the 9-day Volatility Index, is down to 9.54, the lowest since, well, a couple of weeks ago.
You can’t fight the tape and the trend is certainly higher… But traders should keep stops tight, and be ready to quickly hedge and/or add downside exposure.
Our traders remain neutral to bullish for the most part, but cautiously so.
Henry: Everything looks great for equity bulls from here. With the VIX near the lower part of the Bollinger Bands I always like to think cautious, but I’m going to focus on continuing to nibble long rather than try and hedge positions.
Chris: I think that the /TF will be the tell. a breakdown from the bullish flag would be bearish for all the markets.
Carolyn: I still consider myself a “cautious bull”. Bullish because the pattern is still higher highs and lows and we are above all key moving averages. I am cautious however and wanting to use tight stops on any longs since we are closer to EXTENSIONS where moves tend to terminate on the weekly charts AND we have another Fibonacci Timing cluster via the weekly charts. This timing shows resistance to the current rally around the weeks ending 1/13 and 1/20.
Tucker: The S&P 500 has been trading in a consolidation pattern since early December. However, a squeeze did form yesterday. A squeeze firing long could be what the S&P 500 needs to propel it through the December 13th high, and begin the next step up.
Doc: The year-end evening up and the typical quiet period around the NFP report has probably given us about all we’ll get for a pullback from the recent rally since the election in November. The rally has a good probability of extending from this point on into 2017.
David: I continue to look higher in the S&P 500 and the Voodoo snowline near 2292 might be a good target area for this leg up. We still can’t rule out a return to modestly below last Friday’s low to attract more bulls, but with or without that pullback, up remains the trend and the snowline a reasonable target. I prefer sooner to later, but the market makes its own plans.