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With the SP500 now +25% from its deflated “Depression” lows, there are a lot of bulls out there asking themselves why they are so bearish. This is a very good thing – it’s bringing liquidity back into a market that’s earned herself lower volatility and more predictable trading ranges.

The US$ had an important intraday reversal and now higher beta assets like commodities and stocks continue to “re-flate” as a result. This is what happens after asset bubbles pop and new ones in terms of negative sentiment form. The bears have doubted this move from the start – we should be thankful for that.

My new trading ranges are outlined below. They are, on the margin, more bullish than they were prior to this morning’s open. That’s just how the math works.

Topside resistance for this market’s immediate term “Trade” moves up to the 951 line, and intermediate “Trend” resistance remains formidable at the 963 line (see chart).

On the bullish side of the “Trade”, your support line has built itself up to 896, and there is considerable support below that line at 884. Keep moving.
KM

Keith R. McCullough
CEO & Chief Investment Officer