S&P500 Breaks Out to New Post-2009 High

New High on S&P500

S&P500 index (SPX) broke out from the 1420 area resistance, formed by spring 2012 highs and August 2012 highs, and closed at new post-2009 high at 1432.12 on Thursday. It has further improved the highest close to 1437.92 on Friday.

S&P500 index

Below you can see a chart of S&P500 since 2007. There is not much left to reach the all time highs (1550-1577 – less than 10%), but first we must clearly break through and above the May 2008 high area (1420-1440).

S&P500 index since 2007

Although we can find some similarities among 2010, 2011, and 2012, this year unlike the previous ones we are seeing new highs of the year in early September. In 2010 and 2011 the market had been close to the year’s low at this time of the year, and a rally followed soon after.

VIX (CBOE Volatility Index)

With equities breaking out higher, the VIX dropped 3 points in the last two days and closed at 14.38 on Friday.

VIX (CBOE Volatility Index)

VIX Futures Curve

VIX futures curve shifted downwards in an almost parallel fashion in the last two weeks. The steep contango remains.

VIX futures curve