Since I have been away for a few days I want to look at where we are in this rally in terms of time. The current rally is 20 trading days old. It takes about 30 trading days or six weeks before there is a high probability of something more than a shallow pullback. If this rally lasts through next week it would set up a very high probability short opportunity, but currently we are neither overbought nor oversold on an intermediate term basis.

Looking at the shorter term we did the minimum last week by pulling back, so betting on a pullback is no longer the high probability trade it was early last week. At the same time a low risk long did not set up because we never became oversold. Normally, I would think the current setup was bullish but I can't help but suspect that the correction last week should have been a little longer but was cut short by the David Tepper rally. The poor statistics on Friday's rally, such as new 52 week highs contracting from earlier in the week, support that notion.

Sentiment too has not reached an extreme although it seems we are one rally away from turning the crowd to extreme optimism. All in all, the statistics are not giving a strong edge in either direction.

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