The market has a good bounce going today and currently the SP500 is trading right near the 61.8 fibonnaci retracement level of the decline that began on 4/26/2010.
If the sp500 trades higher than 1219.80 in the days ahead then the big sell signal I mentioned in my previous posts is going to have to be considered invalid.
The sp500 right now is also trading in reaction fashion right back up to the underside of the up trendline that it broke 2 days ago on very heavy volume. Up trendline breaks are to be taken seriously in my opinion especially considering how far and how fast the market has come up so far, not to mention all the current sentiment readings that are so out of the stratosphere bullish.
Important also is to remember that market tops are built on hope, not fear. So there is this tendency to push and push and push until the last breath comes in to finally nail the top.
The determination on whether the market is able to make a new highs seems to be riding on the GDP numbers that come out tomorrow morning at 8:30AM eastern time.
In order for the market to make new highs, it is going to have to break above this trendline that it just broke down through. Certainly this is possible, but at least for now I am considering this as unlikely to happen.