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MV Sports Report: End-of-Week Quarterback Sack for Market?

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Rain or shine, we review the day's biggest stock stories.

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My memory is foggy. What's that old Wall Street saying? If they aren't going lower, they're going higher?

Yep. And wow, is that clear now.

Like the rocket in that Omega commercial, the market shot up into uncharted territory today. We saw a clear break-out in the S&P 500 fueled by strong earnings reports, including 3M(MMM), Potash (POT), and Celgene (CELG). It climbed by 2.33%, to 976.

The DJIA also crossed the psychologically important 9000 level, closing at 9069, up 2.12%.

The question on everyone's mind: Is this a blow-off top or is the S&P 500 heading to 1000? Which oddly enough 1000 happens to be the next level of resistance.
Today on the Buzz and Banter Professor Jeff Cooper offered his thoughts.

"My thinking going into the pullback into early July was that it would probably be the correction before the correction. Ditto, this breakout may prove to be the breakout before the breakout.

"If after a pullback to 940ish, Hoofy gets back on his hind legs again, the S&P may rally round the flag to tag 1000 going into early August. 1007 is on the 'master square' matrix (same vector as 768 2002 low and 1576 2007 high) and would satisfy a 50% move off the low.

"Similar to the near 50% move 5 months off the 1929 crash low. Now, I'm not saying, I'm just sayin'.

"It doesn't mean that antecedent will repeat, but it does suggest that if that profit-taking may ensue and that if the market does roll over, the historical pattern may elicit some dour sentiment."

Getting to 1000 does seem like the most likely scenario: EPS has been better than expected (revenues have been in-line to weak), the daily S&P chart is clearly breaking out, and it's my belief that the majority of retail investors missed this climb.

Will it do it in a straight line? No way.

On today's Buzz, Professor James Kostorhryz gave his thoughts.

"Virtually nobody believes that this move up is "justified." There are virtually no pundits out there pounding the table telling investors to buy.

"This suggests that further upside is certainly possible. One would ordinarily expect more "capitulation" by the sell-side and the punditry as a signal of a top. However, the extreme skepticism with which this advance is being met in the financial media is a bullish factor that must be reckoned with.

"This is not a strong enough reason to be long. However, it is the main reason that I am being cautious with my shorting.

"I will give the 980 level a stab on the short side if we get there before the end of the day and hold a net short position over night. There has been a strong pattern of 3.00% up days to be followed by 1.00% down days. And then there is the "weekend risk" factor to think about tomorrow which could provoke some profit taking."

As James said, it's difficult to be short this tape -- but I think it's also difficult to be long if you caught this rally. (Hint: Look for profit taking). If you're in the breakout to 1,000 camp, I'd wait for a pullback.

Looks like we may get that pullback in the morning: Amazon (AMZN) and Microsoft (MSFT) both look weak.

Have a great night!
No positions in stocks mentioned.

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