S&P 500 Breaks Above Resistance

The S&P 500 Index has continued to track sideways at just below well established resistance at 1135 level during the remainder of last week. On Monday the index opened higher and accelerated through resistance to close at 1142.71. This marked the highest level the index has reached in 4 months. Although the staying power of the recent breakout is yet to be established in the short term, it is significant.

Although volatility could return at any time, with quarter end next week and hopes for more Federal Reserve intervention via QE2, we would not be surprised to see the market make a run to 1175 or the "flash crash" high of several months ago.

With the majority of economic data now surprising to the upside, fears of a double dip have decreased dramatically and the unwinding of this negativity has had a powerful effect on the markets.