Check this out - what we see (at least I do) is that when the spread is rising - so is Nasdaq.
But not only that - note the long term resistance around 2.1 and how the line has been touched several times before we broke upside at (E).
And her comes the fun part: it broke after a failure break down at C (classic)
Now - look at the little pink arrow at A in the upper chart it points up and in the lower chart it points down (indicating direction) and how tops 1 and 2 diverge in the charts. (at the top in the spread 2008).
That divergence resultet in the dramatic move straight down to C and the large failure break.
This divergence is important - we have another one - on a much larger scale!
From point C the spread is going straight up!
Comp Q is not - we have a mega bulldivergence.
And sure enough - the combination of a breakdown failure and divergence pushed the spread above the long term resistance.
And when didt that happen?
It happend when Nasdaq broke above (E) which can be regarded as an IHS (inverted H&S) and since the we have had a perfekt abc correction AND a new break at "e"last week.
In other words we hav a long term bullbreak.
In this chart I have exchanged CompQ with NDX.
If you are familiar with chart reading, you know that breaking a rising trendline is serious. You also know that what usually happens ist that the movement gets faster than when we have "normal" break.
The break HAS been tested so we are ready for the fast move.
Now, this chart is interesting - it's the same spread, but long term.
What is interesting is that the trendlines fit so perfectly. I would say, that what we see is the "speed" of the spread.
And if we agree that Nasdaq is the leader and that the Nasdaq index will rise when the spred rises (as it has done historically), is it not then probable that Nasdaq will continue rising according to the "speed" of this chart?
Let's get detailed again.
This is NDX and note how the Pitchfork has contained the movements of the index earlier - worked as support/resistance.
But let's start from the beginning - by understanding what HAS happend we will understand what will happen.
What we first notice is that the lower median line in the pitchfork stopped the index at A.
NDX then moved up to B were it stopped, which was a combination of old bottom, median line and fib resistance.
This area was tested twice and NDX was then sent down for a bottom test (higher) again at the lower median line.
Where it again turned up - the test is over and we can start getting real!
Without hesitation it moves through any reistance that is in the way and doesnt stop until - E- where we have a combination of fib resistance.
1) the 50% pullback of the GA decline and the 38,2% correction of the FA decline (the whole "bearmarket).
Last week we cut though that one as well in a powerful move.
So we are at the races again and nothing will probably stop this move unntil we are back up to the 2008 bottom.
But let's ger even more detailed.
In this Compq chart we can se the set up for the comming move.
We have a combination of Hidden Divergence (blue) also called Springboard and a normal Bullish divergence (red).
So what happend?
After the bottom at B the index raced up without consolidation instead gapped up - where, after the gap, at least should have consolidated a little . Instead it continued up, breaking the last resistnace levels: 1 and 2.
So where are we?
In this DAX chart we have two Head and shoulder patterns. One is inverted (blue)
One is true and one is false.
Last week it was revealed that the inverse pattern is true and the top pattern is false - Those betting on the top pattern now have some reversing to do - hence the comming fast move.
In this chart we can see what happend in a similar situation. It is alsmost en exact copy of where we are today in DAX (actually the US indexes have some similarities which I showed in my earlier post below.
This is what a Beartrap looks like.
And small beartraps can become big beartraps.
Like this one!
We are comparing DOW in Dollar and in Euro.
In Euro it is evident that we see a bullflagg - large bullflagg.
Lines A and B are parallel
The Dow in dollars shows the UPtrend with the failure break.
We are now back inside the trend.....
What we have seen in theese charts is what's going on under the radar - this is what the Market is doing - not just SPX.
Most people are focusing on that index and right now I think that it is misleading. It is not showing the whole truth.
And if you are thinking this is quantity versus quality - show me the quality.
Actually, I think stockcharts. com is doing analysts a disfavour.
With everybody looking at the same oscillators and thinking more is better (her you have quantity versus quality), I think it's easy to get caught up with the crowd.
Oscillators are just a delayed function of Price - so why not just look at price and get the news at once?
Nice charts. 
