Tuesday, 11 December 2012
The previous email below was from 12/03/12, and was entitled "Year-End Rally or New Bear?" (2nd graph below).
After today's nice market gain, it seems like the "Year-End Rally" has won. All MIPS models are long, so that's a good thing.
In the 1st graph immediately below, you can see that the SPY danced between its 50-day EMA and the strong upside resistance level of $143/share (the neckline of the triple top) for almost two weeks. But, today the SPY broke out of this tight trading range and closed up at $143.44 on slightly higher volume.
We all know that one day does not dictate a new market direction, but today's breakout was impressive. If indeed this turns into a nice new intermediate uptrend (year-end rally), MIPS should stay long. However, if it turns south, we can expect MIPS to pick up the new downtrend and take us short. More later ...