You have to hand it to the bulls. They are a relentless group that never wants to throw those bears a bone. They're getting a bit selfish aren't they? I mean, come on, every once in a while, the bears have to get some love. Don't they?! The news overseas on the economic front over the weekend wasn't good, yet, even though some foreign markets were down, our futures seem to know of only one direction. The low of the day was the open, but overall the S&P 500 traded in only a seven-point range for the entire day. When the VIX gets this low it's harder for the market to flash major-league volatility. It gets a bit boring, for sure, but that's the price you pay for increasing froth, which is clearly what's taking place here.

It's quite possible that Wednesday's number will show the bull/bear spread at a very dangerous, historical level of 35% or better. We came in to last week at 33.4%. With a decent market last week, seeing 35% is not out of the question. In this market we may need a lot higher than 35%, but I have to tell you that under normal circumstances, when you hit 35%, it's a get-out-of-the-market reading. Low VIX. Froth ramping. You know the story by now. No classic sell signal, but respect the market at all times. The risk is very high, even though we're not seeing it in price at this moment in time. So we're grinding higher in a very low VIX environment. This tells you to lower your expectations of big moves north, and to, again, realize that a huge move down can occur at any time without warning. Keep it long, but keep it appropriate.

Facebook, Inc. (FB), Amazon.com Inc. (AMZN), Netflix, Inc. (NFLX), and Google Inc. (GOOG), were all red today on a day when the Nasdaq was the best performer. Not sure what to make of it, but it is interesting. The bulls can say that things are beyond great. To move the Nasdaq decently higher on a day all the normal leaders were red shows the continuing rotation we've seen for years. The bears can say that when an index breaks out, such as the Nasdaq is doing, you want to see the leaders lead, and today they did not. Truth is, it's probably nothing from nothing, but when markets get too frothy, and get a bit tired and riskier, you often see the leaders pull back first and then eventually all the rest follow along.

I'm not sure if that's about to happen here, but we can add in negative divergences again on the sixty-minute charts just about everywhere, so just be aware is all. Oh, and also another tag of 70 RSIs on the sixty-minute index charts when the market was at its highs today. You really have to wonder how much longer this grand disconnect can keep moving along to the up side. It makes less and less sense every single day. It feels like we should be crashing out, and yet, we grind higher. I don't know folks, I would just keep it appropriate, but, of course, do what feels right to you. Bottom line is above 2134 we're all good.

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.

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