Don’t interpret this as a bravado-fueled chest-thumping post.  A measured target on a monthly chart can be plotted by a chimp with calculator. That said, here is a chart of SPY created shortly after it made the big break to all time highs.  Doink… it would be cool if this is the top, but it’s just one down week and the market needed a correction badly.  So no reading more into it than that.

I have been seeing the markets as well as I ever have (which is far away from perfectly) coming out of 2014 and into 2015.  For some reason charts are working.  By that I am talking mostly about daily charts and in many cases daily stock charts.

It may have something to do with the droves of dumb money that have been piling in and forcing individual stocks to act in a more linear fashion (ex: Google (GOOGL) paints a nice short-term pattern, tests and finds support and expresses the pattern bullishly as hoped), maybe wresting some of the action away from those erratic black boxes.  Dumb money would force that linear action upon downside action as well, as they puke back out.

Patterns have been playing out as expected and beneath the surface I have a weird feeling that some heavy hand has backed off the markets or that the shear noise created by too many algos and too many jawbones has itself been drowned out in favor of more traditional market action.  Again, this could be a sign that the public came in big with the latest extreme over bullish sentiment.

I am heavy in cash (per recent NFTRH), short a little (per an admittedly timid NFTRH+ SPY update yesterday) and thoroughly going to enjoy this.  Patience, as always, will work well.