Tuesday: No Trade, with musings on perspective

My screening of Friday's market results (see "Tuesday's Prospects") produced no potential trades for today. So I won't be taking a closer look at bull or bear signals with an eye toward opening any new positions.

The indexes traded higher at the open, prompting the usual flurry of happy-talk headlines ("Dow rockets, stock prices jump" -- USA Today).

Just to keep things in perspective.

The S&P 500 began its current leg up on the weekly chart from 1074.77 in mid-November 2012 and peaked at 1687.18 last week. Today's high so far has been 1674.21, and with four hours to go before the closing bell, the price has drawn back to 1667.23.

A close above 1687.18 will suggest the S&P 500 is continuing its uptrend, and a close below 1074.77 will mean that a weekly-chart downtrend is in place. (The present uptrend began in 2009 from 666.79.)

On the daily chart, the present leg up began from 1536.03 on April 18. A decline below that level would suggest further daily-chart correction within an uptrend.

Bottom line: A good day for bulls, but don't break out the champagne yet.

A note on terminology: Analysts use words like long-term, mid-term and short-term, but I have no idea what they mean. So I prefer to use the chart underlying my discussion to indicate the time span that I'm considering:

• Monthly chart for the S&P 500 uptrend that began in 1995 and has been in a sideways correction since 2000
• Weekly chart for the uptrend beginning in 2009 within the larger correction, and also for the most recent major leg up within the uptrend, beginning in October 2011.
• Daily chart  for the leg up that began on April 18 within the large leg up that began in 2011 within the uptrend that began in 2009.

Confusing? You bet. So I'll end this idle musing with my favorite quote from the Dune universe:

"Wait a bit, Tyek," Farad'n said. "There are wheels within wheels here."

--Children of Dune, by Frank Herbert