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Articles > Advisories > Commentary
Advisories |Friday, January 2, 2009 7:39AM EST
MCMillan Market Commentary
by Larry McMillan
$SPX is now approaching the 920 resistance area once again (support is at
850-860). A breakout above resistance or a breakdown below support would be
significant. The $SPX is current somewhat neutral as the index
is bouncing between those support and resistance levels, in a trading range.
The equity-only put-call ratios are positive. They had been
moving sideways for a couple of days, but now have resumed their
downward trend once again. As long as they are trending downward,
they are on buy signals. They still have quite a ways to run before one
would consider them to be "overbought."
Market breadth has improved dramatically this week. As a result,
the recent breadth sell signals have been canceled.
Volatility indices ($VIX and $VXO) continue in downtrends as
well. $VIX closed at its lowest level since September. A downtrend
in $VIX is also bullish. However, it should also be noted that $VIX is
still at 40, and that is a very high number for volatility.
In summary, the current upward momentum in the market could
continue, since we have buy signals on most of our indicators. A
breakout above 920 would be very positive. No matter how strong this
rally proves to be, we still do not think the bear market is over; we
expect the November lows to be tested again in the coming months
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