Bulls Try To Go For Six In A Row

The market is up sharply this morning, with the major indexes better by more than 1% in early trading. Last night, earnings season kicked off with Alcoa (AA) and Novellus (NVLS), both of which reported better than expected results and saw their stocks rally.

Tonight we have Intel (INTC) on tap, which should be an important datapoint for the tech sector and the semiconductor index.

Asian markets were lower overnight, led by China (-1.6%) after news of continued efforts there to slow property investment and steel production. But European bourses were nicely higher this morning after another successful debt auction by Greece.

This is boosting the euro, and weighing on the dollar. Commodities are also higher, with oil up to $76.75, and gold rising to $1217 right now.

The 10-year yield is higher again, climbing back to 3.08%; the volatility index (VIX) is another -2.9% lower to 23.70, which marks a big decline in expected volatility.

Trading comment: As I mentioned yesterday, the S&P 500 is nearing an important test at its overhead 50-day average. That key moving average currently sits at 1095, just a couple of points away from current levels. I think it is highly likely that the market pulls back initially, but the key will be if the market can re-rally after a brief pullback and penetrate those resistance levels.

I saw an interesting statistic this morning: According to Jason Goepfert at sentimenTrader.com, the last time S&P futures gapped up 1% after five straight up days was September 2006. There were two other times in history (March 2003 and September 1996) that this phenomenon occurred. Both dates marked the launch of bull markets. Interesting.