The market is now ready for an upside breakout

The market is now ready for an upside breakout to the 200 day moving average.

http://finance.yahoo.com/q/ta?s=%5EGSPC&t=6m&l=on&z=m&q=l&p=m20,p,e200&a=m26-12-9&c=

China was up 3% again but most of Asia was only fractionally higher. Most of Europe is up about 1.5% this morning. US market futures are positive this morning indicating a positive start to today's trading.

Look at this excellent service and how China is about to break out on the point & figue chart.

http://stockcharts.com/charts/gallery.html?FXI

We talked about the buying stampede starting again yesterday. Last night Kudlow on CNBC went against the negative analysts and suggested that a buying panic was brewing, as the bull market train is about to leave the station. All the negative talk seems to be discounted in the already too-low stock prices.

Another indication that the stock market is returning to normal from panic mode is the volatility index, ^VIX, which is declining from high panic driven levels. We want it to be moderately high so the market cautiously climbs the wall of worry and does due diligence. If it gets low like it did from 2005 to 2007 it shows a lack of due diligence and the possibility of a bubble where everyone just buys and holds as with a Ponzi scam.
VIX should normally be around 20 to 40 when climbing a wall of worry. When a Ponzi Market forms the volatility drops to the 20 to 10 range.

http://finance.yahoo.com/q/ta?s=%5EVIX&t=2y&l=on&z=m&q=l&p=p&a=m26-12-9,v&c=


Good luck with your investment journey