Groundhog Day

Today, the S&P 500, like a certain groundhog from a certain small town in Pennsylvania who shall remain unnamed, peeked its head out from its burrow underneath resistance and didn’t see its shadow. The S&P climbed right out and closed out the week above resistance, albeit just barely. So, rather than six more weeks of stock market winter, it looks more and more like we’re ready to break out.

S&P 500, 30 minute bars

S&P 500, 30 minute bars

Furthermore, the recent uptrend remains well tested and intact. The jobs report today initially took the S&P down a notch right to uptrend support, but the healthy 200k headline number clearly fit the bill for the “Goldilocks” employment growth on which the market has thrived in recent years. Looking at the 30 minute chart, there is little reason to believe we won’t get more of the same price action for next few days, and possibly few weeks.

S&P 500, daily bars

S&P 500, daily bars

The question now turns to what might present the next obstacle to further gains for the index, or even be a driver of retrenchment, or possibly even a resumption of the downtrend in place from the May 2015 highs.

Have a great weekend, and make sure to check back next week.

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