The SP500 finished the week with another new all time closing high, and the DJIA finally put in a new all time closing high by a weensy 1.20 point above previous all time closing high.
(click on the chart to get an enlarge view)
The SP500 is bumping against the upper trendline of the rising price channel as shown on the weekly price chart.
There are two possible near term resistance levels for the SP500. The Fib 127% extension near 1926 is the first resistance level the SP500 must overcome in order to breakout from the rising price channel. If it get rejected, then the SP500 could be headed back to retest for support near 1902. If it succeeds on breaking out from the rising price channel, then the SP500 could be making a parabolic move toward the 1960 level and entering into the climactic phase of this upward move.
It doesn’t matter if you believe this time is different, or you believe the economy is not as bad as some say it is, or you believe the bond market got it wrong. Just trade what you see and not what you believe. Stop trying to find correlation, there is none. No matter how much things change, they remain the same! It doesn’t matter what is used to inflate the balloon, helium, air or water, it will pop the same as always. Be humble and be cautious.
