SPY breaking out...?

Todays action was typical of a trending market. The SPY opened right on its 10day moving average, traded slightly lower, then plowed higher on a steady (can you say billions of dollars in what looked to be big VWAP vanilla buying?) volume. IWM, which opened right on its 20day moving average before going straight up in a similar move,  actually outperformed the SPY as traders searched for alpha. As mentioned previously, these moving averages need to be closely followed and acted upon for active traders.

As the chart below highlights, the SPY closed above its most recent closing high of 141.61 (red horizontal line). This move occurred only on average volume and was not confirmed by a higher closing high in IWM, but was confirmed by the smallest of margins in QQQ. Although some people may be inclined to buy on this move, I believe caution is warranted because of non-confirmation (or barely confirmation) with IWM and QQQ. However, an early pullback tomorrow morning on lighter than normal volume and it could make for a good entry for an intraday move higher.