Well it's midweek and the market is still holding the 1000 mark. However, I am a bit more cautious than I was a few days ago simply because the euphoria is mounting. In fact, the past few days I have seen Larry Kudlow and the Dennis Kneale's of the world just about as bullish as is humanly possible. I believe Kudlow was yelling for SPX 1200 the other day, lol. Too funny.
Anywho, on top of this, the CBOE equity put/call ratio slipped under 0.50 today for only second time since October 07 I believe. The total put/call ratio which I also watch hit 0.67 at the open as well. When this gets below .60 and even more so below .50 it tells me the market is much too bullish and an imminent correction will happen. Bill Luby has some great insights on this as well.
We have Euro Bank and Britain interest rate decision in a few hours so that will get the currencies moving. If the dollar cannot sustain this breakdown and push lower then it may end up being a nasty little bear trap in the dollar index, followed by a rally, which means a selloff in stocks. Jobs report on friday morning is gonna be huge imo to determine where this market goes. I think we have the possibility of seeing a blowoff top type of move into SPX 1050 if and ONLY IF all variables setup properly.
If dollar sells off and that is followed by a big positive surprise in jobs then we could rally big time into the weekend. In which case I'd be selling all longs and perhaps even going a bit short. Should be fun to see what happens!