As per usual, the stock market is a fortune teller, a fate sealer extraordinaire. That, or human expectation is that predictable. Whichever way you lean, the SPY bounced right at 105 on its recent pullback (the level we highlighted as the area to expect a bounce if this wasn't a resumption of the downtrend), and then rifled out of the previously negative pattern.
Volume has picked up on this recent bounce. It may simply be that the market is more inclined to melt higher. 130 looks like a key level in the SPY (1300 in the S&P 500). A break above 130 would technically inaugurate a new intermediate uptrend. This could usher in sharp buy-side interest from big money managers, given that the market is horribly under-invested at the moment; furthermore, pundits and market soothsayers (even myself!) have been looking for a further breakdown. On the flip side of that coin there are decent valuations to be had, especially in technology (my favorite "Future World" sector to plant new money), and a decent yield on the S&P 500.
Right now I find it extremely tempting to dwell in the sour patch. I get a twisted feeling in my gut whenever I read headlines associated with our ballooning deficit, or the future direction of tax policy. I am sure we are all united by our excitement! However, part of living in the patch requires a relative degree of pessimism regarding the future direction of our investment dollars, and if the market decides to shake this off and move higher I am not the sort to ignore the development. While I maintain that we could be facing a multi-year expanse of rough road ahead of us, there is no question I am growing more excited about the possibilities of investing in the world of the future -- as opposed to throwing more cash into the ideas of the past. If this is a market low of some importance, we should look at the price action of new, dynamic movers, and that is what I will be spending a lot of my time doing over the next few days and weeks.
Some stocks I'm watching: TIP, LQD, TBT, TLT, MGEE, GLD, SPY, SSO, MELI, FTLK, MGEE, SOLR, NFLX, AAPL, APEI, TSLA, BEXP.