Short term, the market outlook will be importantly influenced by investor psychology and the degree to which public policy translates into economic traction.
Weighing against the near-term consolidation argument is the historically significant improvement in the market’s internals and breadth of the rally, with six 90% up days in four weeks, reflecting an abrupt change from the fear of being in to the fear of being out and left behind.
Regardless of whether a near-term consolidation is in the offing, volatility will remain heightened, and my formerly implausible S&P forecast now seems plausible.
….[T]he U.S. stock market appears positioned for further progress, and my mid- to late-summer destination of S&P 1,050 remains on target. [via TheStreet.com]