Finally

We finally hit the 2011 highs on the S&P. After an initial downside opening off Europe news, the market found its lows early and ratcheted higher. The 2011 highs in the cash S&P 500 were hit but couldn't hold there into the close. Breadth was flat and volume came in better on both the NASDAQ and NYSE. There was no celebration, no party poppers, no CNBC hats it was just a target being achieved. So now what? Now it's time to watch the market's next move. Will we reject? Will be go through it? Will we go sideways? Here's my thoughts. We have serious resistance around 1381.75, which is just about 10 points above Monday's highs. That's the 78.6% Fibonacci retracement of the swing down from the all time highs to the 2009 lows. While the 2011 highs may come in as resistance here, I expect that retracement level to at least provide a stutter step for this move. If we break right through it, I will be watching for a stall out and a shorting opportunity. The best thing for the bulls into that level would be a test and hold (or slight break) and then a wind up or pullback to break through.