Weekly Commentary 3/23/2012

By Lawrence G. McMillan

The stock market, as measured by $SPX, continued to advance in a narrow low-volatility manner. There is solid support at 1375-1380.

Equity-only put-call ratios continue to trade sideways, in a very back-and-forth manner. As long as they are in this state (and you can see the charts in Figure 2 and 3), we are considering this indicator as being "neutral."

Breadth has not been particularly strong for some time now, but it hasn't proved to be a major hindrance to the market. Officially, the breadth indicators are currently on sell signals, though.

Volatility indices ($VIX and $VXO) have continued to decline, trading down to 14 in the last week. As long as they are in a neutral to declining state, that is bullish for stocks.

In summary, despite some weakening technical indicators, the market's trend is bullish until support levels are broken.

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