SPX Read going forward - February 13, 2011

We got our dip alrighty. Two Fryday's ago, A one day dip was about all the market could muster. The rebound from the Egypt sell-off news has been impressive. Up until we broke 1310 and held it for a week, I was still thinking topping pattern. That has pretty much been violated. The 10 day EMA has been consistent support. Buying any dip no matter how slight off this area has been rewarding. Since we hit 1274 I became very cautious on the longs as well as the shorts using small size, looking for the elusive dip, which never really came. Resistance has been like butter in this push though 1235 due in part to the "Vacuum". As you can see on my charts of the weekly and more importantly my monthly, the vacuum which was turned on at 1121, still has way more to go. Long term resistance is 1338 and if we break it, we should get "sucked" higher FAST. The monthly chart continues to point to a multi-year bull run, but keep time frame in mind. My next overhead resistance numbers are 1370,1404, then 1432. First "real" support under us is at 1274, and then 1235. The market can always go way higher and also way lower than one would normally expect. Just like this run from 1039 this past august, as well as the one from 666 in 2009. Both the daily and the weekly charts have embedded stochastics, which one should never short. Even the volume has been good as of late. I will continue with caution and the same smaller size etc for now. It is also options expiration week as well. Going into last Thursday I felt as though we would see the low through the following week, still feel the same. That low was 1311. We just might see 1370 by Fryday. Good luck out there this week.