Stock Market -- Technical

Officially, I guess, the current advance off the March lows counts as
a bear market rally. Shorter term trend indicators are positive. The
SP 500 at 1365 is mildly overbought relative to the short run trend.
The index also faces several discrete resistance levels from 1370
clear up to 1400. The weekly intermediate term indicators are also
rounding positive, suggesting further upside may lie ahead. These
largely momentum indicators have been trending negative since Jan.
of this year, so reversals require mention. I also like the weakening
in the 15 month-long uptrend in the $VIX.

But, look, first things first. Let's see how well the market starts to
challenge resistance, remembering that in a bear market, signs of
weakness in a countertrend rally often summon swift retribution
from the bears.

I am also watching the oil price relative to the stock market. The
stock rally has fared ok recently against a rising oil price, but there
is no shortage of players out there who act to crimp the market's
p/e ratio when inflationary pressures are evident.

For an intermediate term look at the SP 500, click here.