Bears On The Run

I had that Paul McCartney song going through my head as the SPX took out its overhead resistance near 1280. That was the level where the market peaked last Friday. It is also the level where the market bottomed in April. As soon as that level was taken out, there was a quick surge higher.

You know I have been harping on how the oversold condition of the market combined with the extreme negative sentiment readings was setting us up for a bounce. I think the last 2 days have been strong, and likely market the lows for the near-term.

One of the interesting takeaways from today's session was the the Nasdaq 100 (+2.3%) far outpaced the SPX (+1.2%) for the first time in a while. Stocks like GOOG and AAPL were strong, as were many of the chip stocks.

Breadth was strong, and volume was above-average (though below yesterday's levels). The Hi/Lo Index is nearly back to even on the NYSE (-2) and back to positive on the Nasdaq (+56). Overall, today's action was bullish, and a nice confirmation that I was looking for.

Tomorrow morning we get the payroll report, which will definitely be a market mover. I am hoping for a goldilocks number, like +150,000. Anything well above that will spook the market due to the implications that the Fed will need to be more viligent. Conversely, anyting too weak will spook the market that corporate earnings are vulnerable.

long GOOG