If this is not you then respect what this market has done! After squaring price & time and hitting a long term Fib extension (wrote about it here) and going sideways for only 3 days the $SPX reloaded and charged higher. This was a major signal that this market is not to be disrespected.... Yet.
This morning I tweeted about bears trying to sell the news and failing. The bears saw my tweet and redoubled their efforts. By late afternoon the broader market had given back a nice chunk. It looked like it was pull back time for this market, but @ about 3:35 pm the market started popping. This late in the afternoon is pure smart money. The money that is allergic to chasing the market. These are the traders you must respect or get your trading account chopped in half with a Samurai sword!
Bear side
Yes, there is a bear side. The $COMP & $RUT were leading and now they're lagging. Today the Dow & $SPX both got green by the close but the $COMP and $RUT closed in the red still. This points to a loss of momentum in the market. This could be the first clue of a correction but it happen on lower volume so there needs to be more confirmation. Friday 2-17-12 was a lower close on higher volume but it was options expiration so we can't count it as distribution, but 2-15-12 is a clear distribution day so the count is 1 distribution day for the $COMP for February.
We need more than one day. But today we made a higher high and a lower low so we can say something has changed. We need a close below 2917 on any respectable volume and we can take a shot @ the short side. We get that and I'm shorting with a 2869.81 target with a 2917.88 stop.
Same thing with the $SPX. A close under 1352 and I'm looking for 1341 with a 1352.81 stop. But not before these levels are broken!
We have to respect this market.
Looking @ price I have a 1403 target on the $SPX and 3123.86 on the $COMP and I don't think a pullback will be too crazy. As we all know the market has no masters so anything can happen. All we have is price action as a guide and price action is saying wait for price to break better levels. Don't be impatient and let this happen to you: