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The markets have been on a strong bullish run higher since late March but the broad market averages have been drifting sideways for the past eight trading sessions. The Standard and Poors index (SPX) closed today at 4180, up 45 points, but SPX opened precisely at 4180 this past Monday. Trading volume continues to run below the 50-day moving average (dma), but it did move slightly higher a couple of days this week.

The volatility index for the S&P 500 options, VIX, moved as low as 15% one day last week, but VIX increased this week, bouncing between 17% and 20%, and closing today at 17.3%.

The IWM ETF, based on the Russell 2000 group of companies, has tracked within a channel defined by 215 and 226. IWM recovered its 50 dma today and closed up 4.18 at 225.76. These small to mid-cap companies should be leading the bullish trend, but they remain rather sedate. On the other hand, they aren’t being sold off aggressively either.

The NASDAQ Composite index closed at 14017, up 198 points, but that resulted in NASDAQ being essentially unchanged for the week. NASDAQ’s trading volume continued to just trend sideways, well below the 50 dma.

Talk of increased taxes and new taxes put a damper on the markets this week. But the effects were rather subdued, resulting in a sideways, lethargic market. The market has hit a plateau, which is normal in a bullish trend. It is important to note that we have had several opportunities in the past couple of months for the bears to take control, but it hasn’t happened. The bulls are not aggressively buying, but they are holding the broad indices largely unchanged.

I found a larger number of good stock charts this week and that increased my market disposition to slightly bullish. I entered more trades today and that shifted the cash basis of my trading accounts from last week’s 58% down to 44% today. Stocks seem to be prone to short runs higher followed by quick pull backs, and then it starts over. Many of my losses in the first quarter would have recovered if I had ignored my stops – but that would be a fool’s errand.