ARE THE BULLS TAKING CHARGE?

Today was a victory for the bulls. They managed to push the S&P 500 above 1300 and above the 1295 resistance. The Nasdaq broke above its October high. The Dow is still at that trend line, but it closed near the high of the day...and on decent volume. The weakness I saw over the last two trading sessions was erased today. I'm still not ready to fully join the bulls. If we can break above 12,876 on the Dow, I will likely jump back into the bullish camp. This doesn't mean that I won't consider any bullish trades in the near term. There is an earnings pattern that has developed over the last several months. Just about every earnings season (January, April, July, and October) has seen a bullish trend through the main reporting period. In almost every case, the earnings season rally was followed by a sell off. Some of the sell offs were pretty big. With today's move, I would expect that pattern to continue. Since we are just entering the main reporting period, that means that the uptrend could continue though the end of the month. I've joked with my classes that the minute I turn somewhat bullish is the time when the market will crash. If this ends up being true, I'll immediately start the "Opposite Jerry" blog where you trade against every prediction I make. There are plenty of reasons to remain bearish in this market, but the "price is always right"...and the price right now is going up.