SPX update: weekly chart foretells a big move is coming.

Despite all the negative news coming out of Greece and Europe, the market gained once again the past week, just like last week. So is Greece really all that important?? IMHO: No, because if it were then the market would have told us so. But, it tells us differently. Remember, news=noise and a poor interpretation of the market. Price is what matters, not news, so if we look at a regular weekly chart, we see that the Bollinger Bands are getting very tight. In fact they’re so tight that the Bollinger Band width is the lowest since the price low made in 2009 (red horizontal line).  Readings of BB-width below 10 (blue dotted line) occurred 7 times since then and 6 out of those 7 occasions lead to (much) higher prices longer term (green and red vertical lines). Hence, odds are in favor of higher prices. Simple.

weekly

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