Good morning!
After a pause during the overnight session, futures are breaking to the upside this morning. Several large cap tech stocks are turning up so we may see a follow-through after the nice rally on Friday. I am targeting 4240 on /ES and 13980 on /NQ. It may not reach there today but we are very close to breaking the all time high on the S&P 500. At the moment all eyes are on the bond market since the Fed has started talking the taper talk. Communicating that early and often will be the key to reduce the chances of a larger correction. The expectation is that 10 year treasuries will go above 2% and that is fine but anything higher than 2.5%, equity markets will have a hard time digesting. What is on the side of the bulls is that we are moving into a bullish seasonal period again and after a five week consolidation period, we can easily move higher. Trade small, trade often.
