Bury them bears....bury them bears!

You can hear the chant, but lets be realistic the market is poised for the pullback we spoke heading into Wednesday's action, now especially after 4 positive days.  A friendly, healthy pullback nothing too drastic is likely in the cards.       This market is currently doing everything it can to kill and bury them big bad bears.  Well, at least they think they baad!    Unless you're widespread short in the market, you wouldn't understand the kind of pain the Bears have endured just now.   You might not see stocks we're following flying to the moon,  but you need to understand this is a type of torture you don't understand unless you are ' short' the market.     Every economic report within the last few weeks point to a recessionary and inflationary scenario.     We have the Dollar at all time low against most currencies and oil flirting around $100 again.    Gold notches new highs on a daily basis and most of the commodity prices are notching new highs.      As an economist, this is very very dreadful picture.      So we assume this market should be sold down hard,right?....But, it isn't at all and the Bears are a tad confused!.  The charts "triangles' theory went belly up and they don't grasp the idea 'bad news' is being re-priced as of late.  Okay, let's try 12800 resistance...overbought talk etc.  Anything and everything is being thrown out now by the Bear side to explain the madness.

The theme of this market right now is to "crush the bear" in any way we can.    Sell offs aren't generating any kind of momentum and traders are willing to chase any upticks.   To put things in perspective here, the last few days we had commodities leading the market, Wednesday we had some notable gains from the financials and momo technology names.   Ah ha , what a concept that we addressed the day before as the needed ingredient if/when we go after 12800.    Now, let's see this work it's magic further in the days to come and we could be on our way.    This market just can't seem to catch a break going down.    Of course,the fuzzy bears would have you believe that 12800 level is untouchable and any higher level than now would just be an awesome price to short.    Indeed, if you aren't in any bear pain, you'd be happy to choose a point to short going forward.      However, for those who shorted during the grueling long wedge phase, especially the bottom breaks we covered just days ago,  they are likely in major pain and maybe thinking of covering under pressure.    We have said before that once the wedge is broken, we'd likely trade with the trend for a few days rather than fading the move.     It has proven to be exactly that and we are glad that we did not try to fade(counter trade the trend) the strength last few days.   Also, if you're not capitalizing right now, don't worry... it's not the important thing.  This is step 1 you might say.   The importance is what is setting in if we gain momo and then really go after Da' Bears.     You don't see our stellar '07 momo's running now..the Solars, the Shippers, the China plays and not even the fast Nasdaq techs and big financials...well, we did get the GS and BIDU to show strength Wednesday and give signs of what may lie ahead.      Be patient here, if this is worth our time it will be for the longer term.   So..where does DJIM stand now?   Despite the fact this market has been incredibly strong, we're finding it very difficult to find opportunistic entries when it comes to any good long trade.    With the leadership change today away from commodities, it's even more difficult to stick with "what's working" because what worked yesterday may just not work today or tomorrow.      As far as the overall market goes, we feel that there's still room left for upside and maybe in a semi climatic way very soon.    Other than picking up some fast day trading opportunities, we are mostly in cash since close Monday and waiting for events to unfold.  

Techs, it was interesting to see some of the techs AAPL(also ah) RIMM BIDU.. getting a bid today and as beaten down as they are, you couldn't help but wonder if they could get a couple of days of momentum at least.   Hope today was a start.

Financials, many brokers are wrapping up their quarter this week and are due to report in a couple of weeks.    We are seeing some strength in names like GS MS today without the usual insurer -monolines headlines.. and this sector is really the key for the duration of this rally.

Agri./Chem,  the sector looks a bit tired recently but most of the plays on our watchlist held their 9 ema today.    We'd definitely like to pick up some cheaper shares and we are willing to be patient with our entry. 

Bottom line, with techs and financials firming up today, we wouldn't want to write off this rally and expect it to crash anytime soon.   We all know and expect things to get worse before they get better,  but we also have to respect what this market is capable of.