The US markets propelled higher on a nice short squeeze Friday.  We have now reached a daily resistance area that is an important make or break area (see chart ).

Internally, the market continues to look unhealthy.  Mutual fund cash levels have been reported at an all time low.  Past occurrences have led to 2 market crashes.  Even with the internals remaining on shaky ground, the market has continued to move higher.  We saw a similar pattern during the late 2007 – early 2008 market top and subsequent crash (see chart 2).

It is typical for markets to rally into earnings season which is only a couple of weeks away.  We’ll see if the Dow futures shoot for the 11,000 area into earnings season before we get some possible corrective action.

Check out the charts below which utilize the MTPredictor Elliott wave and Fibonacci trading software for stocks, commodities, futures and forex.

Chart 1

Chart 2

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Tags: commodities, day trades, decision point, Dow, elliott wave, elliott wave software, fibonacci, fibonacci trading software, forex, futures, mtpredictor trading software, stocks, trading software, YM

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