SHORT TERM: last weeks rally continues, DOW +104

Overnight the Asian markets were sharply higher. Europe opened higher and closed +1.15%. US index futures were higher overnight and the market opened higher at SPX 945. By 10:00 the SPX ralllied to 949 and Leading indicators were reported +0.7% v +1.3%. The market then pulled back to SPX 941 by 11:00, and then stayed in that opening range until 3:00, when it rallied to 952. For the day the SPX/DOW were +1.15%, and the NDX/NAZ were +1.15%. Bonds were up 14 ticks, Crude rallied 85 cents, Gold gained $12.00, and the Euro was higher as well. Support for the SPX remains at 935 and then 912, with resistance at 961 and then 990. Short term momentum went sideways, in overbought territory, for the whole day. Tomorrow, FED chairman Bernanke starts his two day Congressional testimony on monetary policy.

Today's rally confirmed the uptrend in most of the general market indices, joining the uptrend in the growth sectors. Looks like the market is back on track for the original Mar 09 Primary wave B estimate of a 50% rally, or 50% bear market retracement from the SPX 667 low. The original projection placed the Primary wave B high between SPX 1001 and 1122. We can now confirm that SPX 956 ended Major wave A, and SPX 869 ended Major wave B. Major wave C, currently underway, should have some fibonacci relationship to Major wave A. Since Major wave A rallied from SPX 667 to 956 (289 points) fibonacci relationships should be compared from the Major wave B low at 869. The first obstacle, for the uptrend, would be a potential double top at the 961 OEW pivot. Clearing this the following levels would apply: 0.382A = SPX 979 (near 990 pivot), 0.50A = SPX 1014 (near 1018 pivot), and 0.618A = SPX 1047 (near 1041 pivot). The wave structure of Major wave A was a simple zigzag, with a detailed c wave. Therefore, we would expect Major wave C to also be a zigzag to complete the Primary wave B pattern from the Mar 09 low at SPX 667. Apparently Primary wave C, and the resumption of the bear market, has been pushed into the near future for now. Best to your trading!

MEDIUM TERM: uptrend

LONG TERM: bear market

CHARTS:  http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID1606987