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

Why:  Late last week, the market came down to test (and briefly violate) what should have been support around 1067-1070 in the futures.  While wobbly, it ended up holding and we got a decent smattering of oversold indications that made it seem more likely that we'd get a short-term rebound than a failure.  And if we did fail, then it seemed almost assured that we'd close the big open gap from June 10th.  Buyers gave it enough of a shot yesterday to hold us above support, but once again the "rally" was extremely meek and has been completely erased this morning.  Not only did that support area give way earlier today, but stocks are already well on their way to closing the gap at 1050ish.  I suppose the best bet for bulls would be more weakness after the open to close the gap, then a rebound, but given the inability to rally off previous short-term oversold conditions last week, I'm not eager to try risking that strategy here.

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.   Since late May, we've 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.  That has led to consistent and significant gains when looking over the next 2 weeks to 1 month.  However, June 4th's Payroll Report kneecapped the nascent rally attempt and took us to a new closing low.  That is very unusual given the studies we discussed and cannot be dismissed.  But since we have seen a lot of give-up among Rydex traders and small options traders, and the S&P made another go at a breakout above resistance, we were willing to give the bullish outlook another shot.  On June 22nd the S&P fell back under its breakout level, so we're going to stand aside and see if it was "fake", or an ominous sign of a lack of buying interest.