PMI's = SPX 1k = Market too giddy

Normally, you’d think we’d be in a celebratory mood seeing SPX crossing and finishing over the 1K level.   Today's jump in index is the direct result of various encouraging PMI readings around the world.    The ISM (PMI) number in U.S shows rebound in IP and new orders rose to levels not seen since the summer of 2007.   This has been an integral part of our trading methodology/ premise.  All you have to do is click the search link on site and type in PMI and /or IP to see how we fit this PMI into SPX1k you could say.  Simply, to us at DJIM, these numbers have been expected and now we wonder with all the giddiness today on the subject of PMI’s was the investor really that behind the curve and/or will the smart money now use this to sell off to all the Johnny -come latelies just over SPX1K?

Also, not that long, on March 6th,  we hit SPX 666 and soon after named it, the ’Mark of the Beast'. Wow, what a devil of a beast up 50% now from those levels.  Today's finish brings us exactly 50% higher off the recent low.   Regardless the type of rally we just had, the action we've endured during the last six months will be talked about and studied many times down the road.   However, there's one thing that kept on hitting DJIM traders' mind today as the previous 2 Journals.     Now that we've crossed SPX 1000, is the end of this special rally near us?    For the longest time,  we've been the out spoken bulls on this rally and it's gotten us nicely thus far this year.   We thought the best case scenario would be around SPX 1000- 1050,  provided this quarter's earning reports hit the market and latest Eco. trends follow the recovery path. 
 
Now that the majority of big earnings are out and we are entering the last stretch of the summer trading with SPX over 1000, we are wondering if this market has any more juice left to go much higher.    Personally, we prefer this market not to go much higher because it'll only lead to the other extreme of the exuberance.   

We feel it's definitely best for this market to settle down and digest its gains.    It isn't just our wishful thinking though.   We are seeing signs lately  that things may not be as rosy as SPX suggests.
There's no doubt SPY'der is doing all of the work lately.    Commodity (the group which has pretty much the worst earning reports) has been on fire lately due to USD$ failure and is all the talk today due to PMI,  but it's the earning plays on our list that are catching our attention on this market strength as they don't seem to be catching the pace with the SPX action.   It seems we get a kick right after we alert of ~5% like on FIRE  (Friday) , today even VIT  (non earnings) and than its flat line action from there on in.  This is frankly a bit worrisome.    For us at DJIM, if good earning plays, particularly small caps don't tag along with the index action, it usually signals a top is near for us.    This doesn't mean that we are turning super bearish and going short at this point.     We just wanted to point out that going heavily long at this point on presents a considerable amount of risk.    It doesn't mean that we won't go long, we'd only go "extra" long on those that behaved the best, but, most of all we are preparing for a pullback.  

Bottom line, market is doing its best to give both Bulls and Bears a challenge at this point as to what's next.   It's absolutely crucial for us to stay cool and rational.