SPX One-Minute Chart Explains Late Day Surge 3/13/12

This one-minute chart shows the late day market theatrics.  Each day is full of drama. The red circle shows the Fed decision at 2:15 PM, markets oscillated up and down and drifted with a lower bias into a falling green wedge. Then JPM drops a bombshell on markets at 3 PM, the blue circle, that they passed the Fed's stress tests and are raising the divvy.  Markets shot upwards like a rocket, the  falling wedge and positive divergence (green lines) already would have launched price, providing lift, and the JPM news added nitroglycerin.  SPX 1386 sturdy resistance folded like a cheap suit, price sliced up thru without hesitation.

SPX resistance at 1389 and 1391 was next, the maroon circle, but at about that time, BAC announces that it passed the stress tests.  Boiiiing.  Price pops again on the BAC news, the financial sector represented by the XLF catapulted 4% today, and the SPX finished at the highs.  Note the rising red wedge and negative divergence in place but the closing bell saved any downside worries. Traders await continued banking results set for release in the minutes ahead.  XLF will paly a large role in Wednesday's trade.  The bulls won today.  The tight BB action was a squeeze move to the upside that was in motion to start today and the banking news drove the SPX up and over the upper BB. In the move up, VIX dropped back under the 15 level to close at 14.76.