I was quite surprised to see so much put buying yesterday on a day when the S&P 500 was up 20 points. I though that it must be an anomaly. However, when I looked at the Rydex data this morning I found that Rydex traders added to their short positions yesterday. That seems to confirm the notion that there is too much pessimism in the short run.
Rallies typically end when everyone embraces the rally. That is clearly not the case at present and the rally likely has more to go. A sell off on the NFP data would likely be a short term buying opportunity.