In focus: Buy signals in place

By Lawrence G. McMillan

The stock market finally responded to a broad set of positive technical indicators and has broken out to the upside. The individual pieces began to fall into place last week, with the last piece (VIX closing below 21) occurring this past Monday. This should pave the way for a strong intermediate-term rally.

The Standard & Poor’s 500 Index ($SPX)   bottomed out in early June, but had been having trouble with resistance in the 1,330-1,335 area and then with 1,340 just above that. Finally, last Friday, SPX rose above 1,340 and has held above there ever since. That level should now act as support. There is some resistance at 1,370, but the buy signals we have in effect should be able to propel the market much higher than that...

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