12/20 Daily Commentary

In reaction to a question as to whether the stock market has ever declined in the face of an advancing I1 I dedicate this post. 
I1 has only been able to confine the market to sideways movement during this down cycle. I'm not heavily shorting the stock market until early March or critical support breaks with I1 going down. QE has distorted the stock market and put it on life support.  The inability of the stock market to break critical support since the July low (except for once in November) indicates that the green light has been given to risk. 
To answer the initial question, I1 has never declined or even gone sideways when it's peak value was +5 or higher.  The March peak value is above +8. The Fed has kept the market from relapsing these past 6 months when I1 was in a general declining period with a trough just below 0.  These conditions indicate that the market will advance from 1/6 through Early March.  I'll be buying a small position tomorrow.

The dollar index rallied today and completed it's 5 wave from Tuesday's bottom at 79.14.   I sold at 80.94 at the 4:15 close based on the action of the Euro, which formed an ascending triangle today. 

I currently have an order buying DX again at 80.47, although this number will creep up through the night (blue line).