I agree with you on the bullish set-up in the face of a plethora of reasons why we ought to pull back. The Dow appears to be gunning for the downtrend line off the all-time highs, and a corrolary to my Happy Family Theory of Markets suggests that all downtrend lines off the all time highs should be breached on the major indices since most have already done so.
The multiple top is a no-brainer on the NDX, as you've mentioned. The still open overhead gap at NDX 1530 ought to be a magnet for price also.
If the SOX gets back into the rising channel out of the spring lows, it should make a run to 540 and then 571-579 in quick order.
We're currently testing the COMP 2000 high. Once we approach that level, the NDX, which is leading this move up, will have already made a new higher high. The fact that the NDX is leading suggests this move is legit and ought to make new higher highs.
The 1934 area was an important pivot area on the way down during the bear. It appears to have come into play again, possibly initially as the .618 re-trace of a run from 1640 COMP to around 2100 COMP.
Fibs off other major pivot areas like 1253, 1640, and 1842 point to 2200-2266 as possible overhead targets down the road. If that is on tap, it would probably be subordinate to a test of the NDX 1735 Dec. 2001 highs. That in turn may be impacted by a test of the all-time .382 re-trace on the COMP. This is all on the table if we are in a blow-off stage.
Taking ourselves away from the emotional element of P/E's and just dealing with T/A, a test of the .382 level on the COMP could bring the NDX and COMP to a test of the historic upper channel lines originating out of the 70's. I still have to check that a bit yet.
As for cycles, I see Les' big cycle turn on Jan. 16 and it's supposed to be a low. That cycle has been very accurate this year, so it needs to be respected. There is a Bradley cycle that runs to the end of February, and it might just be a grind up. I've looked at the TNX and see Feb. 9 as a possible high on the TNX in the 44.50 area. The TNX has been moving more or less up with the markets. If the TNX is to peak at that time, it may coincide with a local peak period in the markets. I show a low on the TNX may occur again around March 6, also another cycle date.
I am not comfortable with this type of market, but I will not deny what is staring me in the face. T/A is probably the only thing that can keep you from getting whipped by this market. Not shorting for any more than a day or two swing is also something that could save you.
Finally, here's a chart that might be considered when looking at the overall market. It's the SPX:XEU (S&P:Euro). If you look at that chart, it looks like the S&P has room to run.
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