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Futures have fluctuated between being up 0.5% and 1% mainly due to a combination of better than expected growth in Germany and stronger than expected demand for the Facebook (FB) IPO. The Facebook IPO will give a good perspective on the "animal spirits" on Wall Street and a strong showing will portend good things for the rest of 2012.

The never ending Greek soap opera continues its newest phase as leaders are scrambling to put together a government which if unsuccessful would require another round of elections. One possible bright spot for Greece is hints of euro leaders acquiescing, if they are able to successfully form a government.

In today's market action, I will continue to focus whether bulls can take back the 134 level on the SPDR S&P 500 ETF (SPY). The risk off assets such as bonds (TLT), currencies (UUP) and volatility (VXX) instruments have been on a tear. The question on everyone's mind is whether the market is topping or a healthy correction.

This chart from Tom McClellan which is comparing Treasury prices and headline news events is a warning that historically jumping into the safety trade is not wise after such events.

(Click to enlarge)

Charts in Focus

(Click to enlarge)Cumulative Breadth not breaking down but needs to be watched

Overnight Action

  • Globex, High:1346.75 Low: 1332.45
  • DAX +0.22%
  • Spain +0.04%
  • China +0.71%

Market Moving Releases

  • Retail Sales, estimate: 0.2%
  • Core CPI, estimate: 0.2%
  • Empire Manufacturing, estimate: 8.4
  • Business Inventories, estimate: 0.3%

Earnings

  • Home Depot (HD), before market open, Estimate:0.65
  • The TJX Companies (TJX), before market open, Estimate:0.45
  • J.C. Penney Company (JCP), after market, Estimate:-0.1
  • Sina Corporation (SINA), after market, Estimate: -0.23
  • Artic Cat (ACAT), before market, Estimate:-0.56
Source: Morning Brief: S&P 500 Higher On Facebook Demand, German Growth