Be Careful Out There …

… it doesn’t get any better than this.

We’ve just completed updating all the daily, weekly, and monthly files in our database in preparation for writing the monthly Insights. We typically don’t write a blog on Sundays, but we were struck by the fact that many of the daily files don’t often get more one-sided than they are now. For example, all 10 of the S&P sectors are on P&F buy signals. The last time that happened was the summer of 2007. Similarly, all 24 S&P industry groups have a bullish bias from the perspective of both the daily Coppock and the daily MACD; the last time that happened was October 2007. There are more, but you get the picture.

While all of this is going on, we can count five waves up on the S&P from the July low. At the same time it appears that the daily Coppock has peaked. (The weekly Coppock Curve still has the bearish bias that first became evident in June.)

So, while there is a case to be made that a coming pullback will only be a pullback within the uptrend from the July lows, now is not the time to bet the farm.

That said, we will give this current “last gasp” from Thursday’s low the benefit of the doubt as long as the index holds above 968.65. As such, the door remains open for a challenge of chart and Fibonacci resistance in the 1007-1048 range.

A violation of 958.65 would be an indication that the entire rally pattern from at least the July 8 low was complete.