BigTrends

Bearish sentiment was steep last week, the AAII said that bears outnumbered bulls by more than 2-1.  In fact, it was the biggest spread of this kind since the March lows!  The chart of the SPX was even portraying a potential head/shoulders pattern, a bearish development that measured all the way down to 980 or so.  We've seen this movie before...in fact, this same thing nearly occurred in July, and the bears were lining up for a bull funeral...intent on taking the markets down.  A funny thing happens during bull rallies...the bears tend to get too giddy in anticipation and get blasted...much like Monday.  Lower volume is a concern but dollar volume was higher, something to consider.  This recent pattern was violated at 1080 Monday.  New highs are just a whisker away, and the market is not yet overbought.