The attached graph shows most all of the indicators are bullish.
Even though we did get overall bad news today, this stock market casino market wants to go higher as options expiration is tomorrow after the close. The market is too bearish, which will sustain a rising market. When the put-call ratio is this bearish, the bears will get little help from the longs having to cover their positions, which would normally bring the market lower. The opposite is now true for the bulls. Wiith massive short covering taking place, its driving the market higher. I expect this to continue through tomorrow. Next week, the market should go into a correction, but let's wait to see what the indicators say.
The 30-min and 15-min stochastics say the market should drop tomorrow. I suspect what will happen is the market will open and go lower in the morning, then rise higher into the close. We hit 870 on the S&P today and closed at 865. 875 is a key high resistance barrior last hit on January 28. If the S&P closes above 875 for a couple days, it might mark a new leg up for the S&P with a high of 940±. The bears will put up a big fight here at 875, but with little support from bulls forced to cover options positions tomorrow, it will be tough. Any real hope to stop the bulls will likely come on Monday. We'll have to wait to see what happens.
Also, another thing worth noting is the VIX, which was at 35.79 at the close. It hasn't been this low since September 2008. This is very bullish. The volatility has to turn up soon, or we'll see a stong market rally strong intermediate term.
Here's my opinion of where we're at in terms of market outlook:
Tomorrow - Neutral
Short Term (next week or two) - Neutral to bearish
Medium Term (next month or two) - Bullish
Long Term - Bearish
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