Tuesday, February 1, 2011

New Highs Don't Change The Outlook

While the SP500 and the Dow made new rally highs today the IWM just managed to make a second retest of its broken trendline. Volume lagged on today's rally as well for most indexes. It may seem that a top will never come, but this rally is getting well beyond the average time and gain for stock market rallies, and there will be a top of some kind.

It is likely the Qs will make at least a token new high, but it is not a certainty.  Friday's low remains the key level for confirming the downtrend.

The MACD remains on a negative divergence sell signal until it rises above its January 18 high.

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