they may keep it up here, at or above yesterdays close like u said and push it on fri for end of month window dressing
It is called sideways consolidation, but I already mentioned that yesterday. Big rallies require more than 1 day of consolidation....
You may get a sell off if part of the bulls choose to call it a day here. Edit: not much reason to keep pushing it up as R1 is reached
Floor Talk: A few thoughts on today's session Generally speaking, the headlines today are of the "market rallies despite poor economic data" variety. This is true: the markets certainly shrugged off the awful Durable Goods Order data out this morning, and have since drifted modestly higher. Yet this shouldn't surprise anyone. As we've stated numerous times before, ever since the October Crash poor economic data has not had the power to move the market in any meaningful way. Think of it this way: expectations are so low right now that truly awful data that comes in much worse than consensus (like this morning's Durable Goods number) is considered "as expected", and bad data that roughly meets consensus is "better than expected". Put another way, bad economic data does not have the capacity to surprise, and for the near-term at least has already been priced in. While the news since last Friday has certainly been encouraging -- Obama has announced some reassuring choices for his economic team, his stimulus plan has been well-received, and the Fed announced a huge $800 bln mortgage backstop -- recognize this rally for what it is: short-covering in the context of what had been a deeply oversold market (see our posts from last Friday before the rally and after it began to get a sense of what we were watching then). This is a holiday-shortened week, so it goes without saying that we should continue to see light volumes for the remainder of today and Friday's half day, and it will be difficult to get any kind of read on the durability of this rally until next week when desks are fully staffed again.
Here is my take on longer term action: We have been in a 160 pts range for 6 or so weeks that ended with a break to the downside, bottoming and quickly moving back to the range. That is a Wyckoff thrust in my book, and I expect it to go through the range in record time. Once the funds realize that they are behind the average, they have to start buying just to keep up with the rest... Not to mention in 1929, after the market reached -50% it rallied back to -25% before further down...(it took 3 or so months though)