Another Monday morning, or any morning these days, and up we go. Italy survived the latest referendum, and with nothing negative occurring, the market decided north was the best direction for it. That's been the case, although slowly, for the past many weeks. The market retested the 2194 breakout and breached below by a bit, but, thus far, it has held its ground overall, and now it's time for it to blast away from 2194 for good. I don't know if it's a guarantee as nothing in this game is a guarantee, but it feels like it may be time to put a little distance away from S&P 500 2194 to secure the breakout for good.

The market doesn't need any really good news to run higher, which is the best news for the bulls, other than the fact that froth is building a bit too much. That said, the market looks primed for higher prices, although clearly not every day. If the market were to fail here once again, and move well below 2194, that would be something we have to take very seriously. For now, I think the bulls are still in full control with only froth being the red flag to be concerned about. Staying long makes the most sense. The degree for which you get long is up to you, so watch 2194 closely and make sure it doesn't get taken out on higher volume with some force.

Bull markets are interesting in that they give you enough bad days and bad times to make you feel as if they won't last that long. I think you all have to learn how to look for genuine topping processes. Number one would be distribution. Strong volume off a major top, such as we saw with SPDR Gold Shares (GLD) back in 2011. That first, and likely second and maybe even third, distribution process will be bought up by the public that's trained to buy weakness. The key to it all is the light volume on the way back up. If you see this process repeated many times, you should be aware that a top is likely being put in.

On top of that, as you get those distribution tops that get bought back up by retail dollars, you will likely see negative divergences form. The combination is lethal for the bulls, so be aware over time when it occurs. It will someday. We don't know when, but it will. For now, there are no signs of it.

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.

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