Lots and lots of drama over the last one-half year but when it is all said and done, the SPX has only moved thru a 125 points sideways range 1340-1465. Today we are pressing up against the top of this sideways channel. The game changer in 2012 was on 7/26/12 when Draghi announced his support for the euro by all means necessary, the most important statement of the year last year. The ECB's OMT quantitative easing was announced at SPX 1403, then the Fed's QE3 Infinity at 1438. Then the triple top occurred and stocks rolled over but all eyes and ears were on the presidential election drama. President Obama was re-elected and the markets collapsed.
A market bottom occurred in mid-November then Bernanke primed the pump again announcing QE4 Infinity and Beyond at SPX 1430 which resulted in a sell off. The Senate saved the day with a fiscal cliff resolution that the markets sniffed out on the last trading day of the year, Monday, 12/31/12. The House approved the fiscal cliff package on New Year's Day and the result was another wild upside orgy. The SPX has gained about 62 points, from 1400 to 1462 in two days, +4.4%. Price now tests the top rail of the six-month sideways channel which represents the highs for 2012 at 1465-1475. Does price now receive a spank down and travel back down to the lower end of the range? Six months of high drama, day in and day out, and the SPX has only moved thru a 125 point range. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.