Weekly gains but reversal day on Dow

SPX secured another four points this week. This is not too much but enough to keep the bullish momentum going as confirmed by positive DMI on both daily and weekly charts. On hourly chart I notice that almost every time SPX goes a little bit bellow EMA 50 there are enough buyers to push the market up again. SPX didn't touch SMA 120 since the beginning of the rally two months ago. Over all SPX remains extremely bullish on all time frames.

The only sign of trouble comes from Dow. For the second time this week Dow touched 13,000 just to give up the gains and end the day in red. Reversal days after touching new highs are generally bad omens so if you are on the bulls' side a little bit of cautions is not going to hurt. The good news is that only Dow shows this behavior, while Nasdaq and SPX despite going down from intra-day highs managed to end the day a little bit on green.

SPX has rallied no less than 267 points since October and one may think that a correction is going to come soon. As I mentioned before, unless some very bad news are going to hit the market I don't see a correction imminent. If markets goes down now, before establishing clear higher highs on all indexes, the long term momentum is going to suffer a big blow and by higher highs I mean well above April 2011 highs.

VIX is pretty low these days but it still has room for lower values.