Here is the daily chart of the SPX. It is now closer to it's up trendline from March and has backed off from the down trendline from Nov. It looks to be setting up for it's next move.
The daily does not give a good indicator of where the market can go. To find that, we should look at the 60 min. Notice the Bullish Wedge forming, we are currently at the bottom of it. A break out of this would be very bullish and would coincide with a break out a 850. Look at the last bullish rectangle when it broke out, it was a very bullish move for the market. Of course a break down of the wedge would negate this move and allow for more downside action.
When you look at the MEGA charts, they are showing signs of again either weakness with a move to the downside or consolidation before an up move. (so helpful I know!)
MEGA-
$NYMO- a move down yesterday but remains in an uptrend. This could have been a pullback to work off the overbought condition and now will allow it to run up.
$SPXA50- a slight tick down and we have a pretty big down day yesterday. So 50's are really holding support. Remember this chart, we could chop around this area for a while, which would be very bullish.
MEGA B-
The up or down volume really hasn't been there. They both look to be consolidating. Although Decliners are moving higher now, but with less volume. One thing to note is that since this rally started, advancers have not got above their peak of early March. (drawn on the chart)
Overall I think the best move is to wait to see if we break out of the wedge soon(today or day or 2). A move up will have to be followed by volume or it won't be able to get above resistance, if it does consider it a fake out. So watch the volume and A/D lines.
