This will be abbreviated, and sorry, no charts today (laptop can't easily do 'em!)

Anyway, the S&P tried to blow through the wedge, put a pin through it, but couldn't hold. The DOW pulled back a bit and the Nasdaq showed surprising strength. The Naz threw a pin at the wedge but didn't go through along with the SPX.

On a technical basis, we're still in the slot. The S&P is almost certain to break the highs on a closing basis in the next couple of days. Beyond that, things get more dicey.

From what I see here I expect we'll actually break the wedge to the upside, simply on momentum. There's nothing in the picture that suggests this won't happen - but with each new thrust the market gets weaker with the attempt, and its now churning from one sector to another to try to shove things higher, rather than dragging all sectors along. The DOW, for example, has broken the pattern but can't clear the top of the wedge convincingly.

This is not a market with conviction behind its move!

On Stochastics today the SPX was actually not all that hot - fast was actually below slow. That is, confirmation was denied on the move upward. The Composite posted a new "BUY" (off its previous "SELL") however....

This sort of "rotation" is very common when runs get near exhaustion. While we are probably not quite there, based on the internals (new lows on the NYSE were non-existent, and those typically spike just before we get a turn) all the signs of a market that is fixing to break down in the next couple of weeks are there.

My thesis remains the same - I believe we're headed for a new high in the S&P, although perhaps not as far as the intraday high (which was 1552.87.) Getting there would be about 2.5% beyond where we are now - I'm not convinced we're going to get that far before things break down. In the next couple of weeks I expect to see a significant break in the market - perhaps as far out as a month - but time is definitely running short, and as we get closer to second quarter earnings the risks accelerate markedly.

This Thursday China's meeting in the US on currency policy (they're allegedly talking about other things, but THE big item will be currency) is potentially explosive. But the exploding part won't be obvious directly at the meeting - and those who think it will be are hopelessly naive. Neither China or the US are about to end up being "the bad guy" on this one - at least not instantly, and not at the meeting. If there is going to be a fireball-style blast on this, it will come from Congress - later this summer - via a veto-proof bill targeting China's currency manipulation. China, for its part, essentially has to fight this, because a stronger currency over there means our goods become cheaper there and theirs more expensive here - this damages their exports, and we all know how important that is to the Chinese economy! Congress, by the way, wants a roughly thirty percent appreciation! This is not a small move, but do not look for fireworks directly at - or after - the meeting.

Asia is up (again), and I suspect the first real chance we'll get for any sort of downdraft will be Thursday when we get economic data on housing. Be wary!

More if there's anything interesting the next few days.....