Improvement Continues: S&P Monthly Momentum Turns Up

As I wrote at the time, the S&P 500 had a significant breakout last week at 850, punching through the bearish trend line and emerging into a new positively sloping trend for the first time since June of last year.

Well, yesterday the Monthly Momentum/Moving Average indicator also turned positive. That is to say that the 30-day Moving Average just crossed above the 150 day Moving Average, another important piece of the market's seemingly perplexing rally from the early March low. Both of these upside breaks are longer term in nature, convincing me this rally is still playable.

A look back into the S&P Momentum/Moving Average Indicator is telling. It last turned negative (the 30 day Moving Average slipped below the 150 Day Moving Average) on 6/29/2007 - 4 months before the all time highs. With both the trend and momentum positive for the first time in quite a while, this move has more credibility than any since the Fall sell-off. I view these dramatic recent improvements in the S&P as a powerful combination of direction and magnitude that I expect will lead this rally higher.

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