Good morning. I believe that the market remains overvalued and that it will take many years for the economy to heal. However, a confluence of factors have lined up for a short term market rally.
The market has become oversold and sentiment has become too bearish in the short run. The bearish sentiment is evident from the put buying for a string of days. This has laid the foundation for a rally. The closing of the Merck/Schering Plough deal, which had an $18 billion cash component, and Berkshire Hathaway's part cash buyout of Burlington Northern have given the market the push it needs. I would expect a rally to last a few more days at least.