Wow, what a day. The S&P blew right through the 800 resistance line and the 40-day moving average and didn't blink. It stopped at a minor resistance line at 825. The next major resistance line is 875.
The CPC and the CPCE shifted to a bullish setup this morning. The VIX shifted to bullish after close. With the shift, the downturn on Thursday and Friday now gives all appearances of being a market correction. With the correction upward for all three of these indicators, it made the dashed vertical sell line on the graph for yesterday a perfect head-fake. The chart shows this has happened two other times in the past six month where all three indicators quickly turned around, which are indicated by the red circles above October 19 and November 5±. However, this head fake was the most perfectly executed of the three and occured during a bullish market sentiment turn-around time period. Even then, the October 19 head-fake didn't really include the VIX, which went horizontal, and the November 5 head-fake can be easily indentified as a market correction.
Like this head-fake, the October 19 occurred during a big news event. I should also point out that the CPC and the CPCE can continue heading down with market sentiment getting more bullish even as the market keeps heading higher. What I try to do is identify the market turn-arounds, which at this point there doesn't seem to be one. With this strong of a move up today, I have to think there will be some bullish follow-through tomorrow.
I will have some additional thoughts and analysis in my premarket opening comments on Tuesday morning.
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