This Rally has brought us to some higher levels pretty quickly. I was anticipating a rally but even this surprised me. At this point we are overbought. McClellan oscillator reaching some overbought levels. I think some digestion would have been healthy, but from here It will be tough to get through 1360 in the cash. I'm looking for a possible test back to the Monthly adown near the 1320ish level or some type of pull in here. Lots of stocks have popped and today we had much of the very beaten names finally squeeze hard. FCX confirmed the breakout, X up 10%! Lots of people have gotten bullish, tough spot to be long here IMO.
Like Shan said, I think we have all the pieces in place for a pretty sizable rally into the fall. A pullback is probably par for the course here but we definitely have our new leadership. I think energy, materials, financials and semi's will lead us out. They all had huge washouts. They could certainly retrace some but I would be looking to buy every dip now going forward. My hard selloff thesis down to 1200 is off the table.
Just one point , humorous maybe... I double dare ya to roll out an infationary QE3 , 500 bil or so, while core CPI is holding steady the last two months at 2.3% which which is above the fed target of 2% or twist again with 10 year rates under 2% What a non-event, except for the maket action.
Confirmed weekly A down in bonds! For the 11th time we are testing the monthly A down in bonds at the 148 handle. Yes...11th! If we take this level out this will be huge and what do you do know, it's a fed day. If the fed hints that operation twist is over they will essentially be signaling a defacto rate rise. We could see bonds hit 145 in a heart beat "if" that happens. Stay tuned...
Silver broke below 28.66 key support but had key reversal at 27.63. Long on failed A down set up. More downside in silver unless 28.66 is taken back.