02.08.2012 -- 21 points

We are 21 points from new multi-year highs on the S&P. If the bears longer term EW count is ultimately correct, the rollover must occur soon. It wouldn't destroy the bear thesis if we take out 1370, but we would have to back way up in the EW count and targets well into the upper 1400's would become possible.

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Key Levels

Upside -- Here, 1370

Downside -- 1344, 1329, 1314, 1275, 1257, 1241

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SPX Daily;

Again, not much change. We are doing what I said was necessary to drag this out. Which is close within a small range each day. +/- 3-4 points at most. How long can the market keep that up? I don't know, but I would guess not much longer.

The MACD is up to 19.73. Moved a little higher. 24 is that magic number we have never crossed on the daily. And the previous times we have gotten that high were all major reversals.

We just have to wait and see what happens. If 1370 gets taken out on a close and stays there for a couple days or more, there will be some big changes to a lot of EW counts floating around out there. It wouldn't kill the bear case long term, but could provide the open door to move prices another 100 points higher.

GL

CJ