Stock Market -- Technical

Back on 7/08, I posted that the market correction had brought
stocks to a significant short term oversold. The action on that
day was suspect enough that I let a few days go by to see if some
sort of rally could develop. Well, contrary to my initial suspicion,
investors and traders did turn the market around off key support
and in the intervening days have brought the rally up to new highs
following the deep early Mar. low.

Now of course, we have a confirmed short turn uptrend which is
getting overbought in the short run. My 6 week buying and selling
pressure gauges do not indicate an overbought yet at all, so from a
technical perspective, I could not argue with the idea that the
market, although subject to short term pullback, could advance for
another several weeks, before a much more substantial overbought
condition could develop.

This recent advance has brought the major composites plus the NYSE
adv/dec line up through major downtrend lines with origins well back
in 2008. From a simple chart perspective, this is very good news.

The up action of the market since the early part of July will embolden
some technicians to argue that we have started a second leg up in the
early phase of a cyclical bull market. Could be, but too early to tell
with any assurance.

SP 500 daily chart.