It doesn’t significantly rise above the 200 day EMA. It did during March of 2002 on the S&P 500, but it was not a strong thrust. It was not a strong rally then… during the peak, the RSI was a 64.

I do not see any more suprising shoes to drop (although Kyle Bass does forecast sovereign defaults and perhaps protectionism would increase and the markets would react negatively to it) because the government “stabilized” the financial markets with the bailouts. Despite going sounding a little bullish, I will say that the credit markets are thawed. I also think Bernanke will be more relunctant to use the printing press the second time because the US is not a closed economy and China acts as a potential straight jacket for that policy option. (I question I want to ask is whether treasury yield are up because of quantitative easing or despite QE). The next shoe to drop would be the market getting an epiphany that the V shaped recovery paradigm is wrong despite the increase in the second derivative; the first derivative would be flat or have a small upward or downward slope.

For some “bullishness” for a generally reliable sources:
http://www.safehaven.com/article-13397.htm
http://www.safehaven.com/article-13426.htm

I am not calling a bottom in housing though or anything like that.

But going short on equities seems to have a nice risk/reward still. Adam on Gold versus Paper should that during a bear market, the general market doesn’t rise above the 200 day EMA. I suppose a nice technical trigger to add to shorts is when this line is crossed preferablly with an RSI of > 65. VIX needs to fall further and the put/call ratio needs to drop.

Some links:

These articles show how I see the world:
http://www.marketwatch.com/story/the-spiral-japans-deflation-sapped-spending
http://www.bloomberg.com/apps/news?pid=20601109&sid=ajxeU5W_HFB4

Also some bullishness (for what it is worth to you):
http://www.cnbc.com/id/30826632
http://www.bloomberg.com/apps/news?pid=20601068&sid=arayDGpmRFZU&refer=economies
http://www.cnbc.com/id/30826359/
http://www.cnbc.com/id/30847431

(Those links make it tempting to go short)

Last, but not least; Peter Thiel is correct: we are in a government bubble:

(He got f—ed because “reflation” was the word of the day month for March-May)

BTW, I was stunned by a chart of sunspot activity vs. the stock market in a recent EWI publication. I have a hard-nosed empirical view of humanity and the universe, so I put zero credence in things like astrology, but the idea that humans, like other solar-energy based life forms, react in measurable ways to the solar cycle does not seem completely loco.

I’ll see if I can dig up a chart later.