VIX Favors Higher Stock Prices


The short-term uptrend continues, although it had a little trouble getting out of the gate earlier in the week. On Thursday, the market felt like it had gathered quite a bit of strength, but with the huge jobs report Friday morning, who knows what will happen Monday morning. Maybe rates will be up and NASDAQ down, I can't predict.

The VIX broke support on Friday and it looks to me like it favors higher stock prices.

The number of new 52-week lows dropped down to a harmless level on Friday after remaining a bit elevated on Monday and Tuesday. (The term "harmless" is borrowed from Mike Burk who taught me most of what I know about new 52-week lows via his weekly articles.)

The bullish percents are rising nicely on all three major indexes. Very bullish looking.

The NDX finally started rising on Wednesday and Thursday, and it is now pushing above the 13,300 resistance level.

The SPX equal-weight broke out to new highs on Thursday.

Even the gold-miners might be getting into this uptrend.

The leaders were the semiconductors last week. This is a good-looking chart from the most important industry in the market.

My accounts are now fully deployed into the market. I have a stop-sell price marked on my charts for each position. 

If the position is not doing well and looks like it will close below the sell level near the session close, then the position will be sold. No favorites or special rules for any positions.

On the other hand, if the position goes up in price, I will slowly raise the stop-sell price. When the PMO gets nearer to the top of its range, then I will get a little more aggressive with stop-sell prices in order to raise cash into strength and to protect profits.

Outlook Summary


The short-term trend is up for stock prices as of March 25.

Contrarian sentiment is unfavorable for stock prices as of Nov. 14.

The economy is in expansion as of Sept. 19.

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Disclaimer: I am not a registered investment adviser. My comments reflect my view of the market, and what I am doing with my accounts. The analysis is not a recommendation to buy, sell, ...

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