Last week, instead of the market going slightly lower, it went slightly highly. The bears demonstrated strength, as shown by the VIX’s ability to break and stay above its daily resistance level by the end of the trading week. However, the market did closed higher than its previous week, staying true to the uptrend. How long will this Santa Claus rally last?
I’m watching the RSI reading like a hawk. As long as the reading stays above the red line (as shown on the RSI reading), the mid-term trend is still UP.
On the daily, the market did not pull back lower into the oversold zone. It went into the overbought zone on RSI, and very near the top of the channel on the first two days of the trading week. Now it is back in the neutral spot. In what I called a no man’s land, not a good place to long nor short.
VIX (the fear index) weekly’s resistance is still preventing its price from rallying above $20. But it has definitely broke above its daily resistance and closing way above that level.
Summary:
Mid term view:
The trend is still UP.
Short term view:
There are many signs of weakness on the bulls. Trade with caution. Might be wise to trade in shorter time frame.
Happiest and Merriest of X’mas everyone.
Cheers
Strongerhead ways to get you ahead
NOTE: All information provided “as is” for informational purposes only, not intended for trading purposes or advice.
