Bears certainly failed this week to exploit a setup that was presented to them. We had a whole basket of divergences from price momentum divergences to A/D line divergences. And there was the pesky 20-week low due end of November. Not only did the 20 week low turn out to be a non-event, but we also erased the A/D line divergences by breaking out above the Oct highs on the NYSE cumulative A/D line.
The Dubai scare was probably the 20-week low. Or one could also argue that the Nov lows at SPX 1029.38 was the 20 week lows. It's hard to say which one was it, until further price action. Any corrective action here breaking the Dubai lows would mean that the 20-week lows came early in November. Instead if we rally from here holding above Spx 1083.74, then Dubai event was the 20-week low. Either way now we have a bullish cyclical structure with the 9 month lows above the prior 9 month lows and the 20 week lows holding above the prior 9 month lows. Of course there can always be non-cyclical forces causing selloffs. But the key going forward is that the November 1029.38 lows should not be broken for any reason. As long as we continue to hold up above that, the bullish intermediate term rally will continue.