- SPY is on a 28% annualized pace as of Friday
- SPY is already up over 20% in six months, nearly breaking the longest streak for the stock market before a major correction (21% over 7 months)
- 20% of the SPY components are 20% over their 200 EMA
- YHOO, BBY, NFLX, GME, and three Biotech names are 40% over their 200 EMA
- The SPY has been moving in 10 point bursts before succumbing to a correction the 50
- The first two bursts in 2013 took seven weeks, the last 2.
- Friday marked an inverted Hammer
- The two main competitors of SPY; gold and oil are waking up from their FED induced slumber
- Margin is at an all time high, amazing! There is no money on the sidelines.
I am looking for a 6 point correction in SPY over the next two weeks. I am short with some June SPY put spreads, and VXX, hedged with some energy stocks (SGY and NFX) and specific miners (NUGT and SLW).
If I am wrong and we push higher, it will drag up the laggards which are the miners and energy stocks. The narrative all is well, so the all is well names should recover.
For the record, I believe there is at most 10 more SPY points left, which is at most 5 more percent of performance. It is inconceivable to me that with the FED's liquidity producing only a GDP growth rate of 1.5% at peak earnings and margins we can continue this rate of ascent.
PS I am conducting some basic and advanced charting and portfolio management classes this month at www.chartingforsuccess.com