I had written in yesterday's post that time was running out for the bears. I must admit I did not expect their time to run out so soon and that too, in such a spectacular fashion! The momentum now lies firmly with the bulls. Add to that the disheartened bears and there couldn't be a better chance for the bulls to take over 1340. As can be seen in the chart below, its been THE resistance level on S&P for quite some time now. However, I would not like the bulls to take it down straight away, and in the process, get exhausted, and give it up back again. Some consolidation here would do their case no harm.
BTW, I did notice some talk on the blogosphere and twitter on the market being overbought. Ignore it! One 200 points up day certainly does not make the market overbought!
Take care and good luck!