Today’s nominal GDP printed at 4.1% annualized rate today. It is accelerating away from the zero line. Recall Lakshum Achuthan’s ECRI index argued the US economy was in a recession last year and by his accounts, the markets should start tipping over at the start of 2013. We can all blame it on the Fed which is twisting economics and equity prices into the unknown and forcing markets to evolve. What used to work does not work and what works will not work in the future. Today is options triple witch expiration and if it is another consolidation day, the bears may just take notice in the days ahead. Overall the market is in a bullish environment but suspicious of the quality of it.
S&P 500 (SPX) SHORT TERM OUTLOOK: BULLISH
Almost all short duration timeframes are not giving much information from a TD Setup perspective. If the 4 hour SPX consolidates further and happen to close below 1810.41, that is not necessarily bearish. It probably means the market is going to stay choppy and add to the frustration of what it intends to do.
S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BULLISH
Have to concede equities are bullish but the confidence is not as strong as it was for previous rallies. Perhaps that is a good thing. One factor will that give pause to this rally is the Russell 2000 (RUT) chart. If the RUT should flip bearish by closing below 1119.85, interpreting market direction will get that much more challenging and we’ll have to dig deeper for more clues.
S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: NEUTRAL
A bullish price flip will occur with a weekly close above SPX 1804.76. However, that is more indicative of a wobbly market than a bullish one. (updated December 16th)
S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH
Will flip back to neutral with a monthly close under the January price flip level of SPX 1681.55. (updated December 1st)