Today's Update:  We will remain Neutral for now.

Why:  The market is mostly doing what it "should" do, which is all fine and good, but it's leaving us without much to discuss among our indicators and usual topics of study.  On a very short-term basis, there were a few things yesterday that stood all, all of which are negative.  According to Bloomberg, during the afternoon we witnessed the 2nd-highest TICK reading in history at +1624 (see Friday's Report for repercussions).  What's even more notable is that there was no TICK less than -1000 during the day, which is exceptionally rare on a day when we also see a +1500 TICK reading.  Of the 11 times since 1989 that that's happened, the S&P was up the following day only 2 times.  Also, the S&P gapped down more than 1% at yesterday's open but closed more than +1% higher.  While it looks good on a chart, of the 24 times since 1982 that has occurred, the S&P was up the next day 41% of the time (results fall in line with random after that).  And we also saw the BKX Bank Index decline yesterday, despite the +1% gain in the S&P.  Of the 28 times we've seen that before, the next day the S&P rose 42% of the time (again, no edge after that).  So some modest signals for short-term weakness here, but I don't have a great conviction in them (other than the TICK reading).  After exiting the bearish outlook yesterday morning, I'm standing aside here as the potentially bearish short-term factors battle with still-outstanding bullish longer-term ones that we discussed earlier this month.

Today's Update:  We will remain Neutral for now.

Why:  On April 15th, the Dumb Money pushed up to 75%, and the spread between that and the Smart Money reached to -45%.  In addition, we got a tremendous surge in the number of bearish (for the market) Indicators At Extremes.  After we got the expected weakness and volatility exploded higher, we experienced a very unusual situation with the "shock day" on May 6th.  We looked at somewhat similar days on May 7th, and the conclusions were clear - a short-term rally was likely, probably being capped at a 62% retracement of the crash, then a re-test of the panic lows.   In late May, we looked at quite a few  bullish intermediate-term studies - we got a major surge in pessimism, then several positive breadth thrusts and positive price performance, all in the context of an ongoing bull market.  After a brief respite, June 4th's Payroll Report kneecapped the rally attempt and took us to a new closing low.  In the process, we've seen very oversold conditions and some give-up among Rydex traders and individual investors, so we'll be looking for the price action to improve to re-establish a bullish outlook.  That would include either a successful test of the recent lows, or a recovery high above 1120 to break the recent pattern of lower highs and lower lows in the S&P 500.