The S&P 500 has rallied a bit during the course of the trading session on Thursday to reach above the 4650 handle. At this point time, the market does look very bullish, but I would also point out that we are a little bit overdone. With the jobs number coming out on Friday, it is very likely that any type of short-term pullback, there will be plenty of buyers willing to get involved. The 4500 level is a major area underneath that I think would attract a lot of attention, but quite frankly I would be surprised if we even got down to that area.
The 50 day EMA is reaching higher, and of course that is an area that I think would attract a lot of people. Nonetheless, this is a market that you cannot be short of, and therefore you just simply need to be patient. If you are not already long of this market, then you need to wait for some type of value that you can get involved with. All things being equal, the Federal Reserve has already gotten out of the way suggesting that they are tapering, but not so much that it is going to be a hindrance to the Wall Street game of passing liquidity into the stock market. Quite frankly, we would need to see some type of major disaster and the jobs number to rock that market, but it would only be a matter of a few hours before Wall Street started buying again, suspecting that the Federal Reserve is painted into a corner and cannot do anything stringent.
The US economy is doing much better than many other ones, so it does make a certain amount of sense that the S&P 500 will continue to attract a lot of attention. I have no interest in shorting this market, and I believe that support run all the way down to at least the 4250 handle underneath. The 200 day EMA sits just below there, and therefore I think it is a major “floor the market.” If we were to break below there, I might be a buyer of puts, but that is as negative as I get in these markets as you know. Quite frankly, I just do not see that happening anytime soon.