So where is that top that's so talked about? The excuses are everywhere, but the bottom line isn't about excuses, it's about results and real price. Not wished for price, but real price. Real price is still up trending overall with lots of little pullbacks that get bought up very quickly. Yes, at some point, this will all end badly for the longs, but the gains we've made are adding up so we'll deal with the losing plays if, and when, they occur because you should keep some scratch in the game. That means you basically have to get caught, at some point, or you simply wouldn't be taking advantage of the trend in place, which we have. No human being can catch the exact top and get out without having a few losing long plays unless you're other worldly. I'm not. So we know it's coming, but we just don't know when it's coming. It should be here based on many obstacles that are out there. Take those weekly negative divergences or those overbought monthly charts not to mention a ridiculous spread on froth.

You would think that even if just one of those realities would kick in this market would take a very decent hit to the down side. If all of them kicked in simultaneously things could get incredibly nasty for the bulls. That type of situation comes out of nowhere. Be prepared for that. It'll hit when you least expect it. There's no way to know how long the actions of the Fed, with regards to rates, can keep this market from falling, nevertheless, don't let your guard down would be my best advice. Getting too long may not be the best idea, while trying to front run the down side may be a bad idea as well. A little scratch. Nothing more and nothing less with those plays on the side of the trend would be my way of playing. Do what feels right to you, of course. Today wasn't the reversal day. Maybe tomorrow will be. Or not. Again, just don't let your guard down. Ever!

The market has fooled everyone as usual as it was widely expected that the market would start a major decline, if not a bear market the moment the QE program was officially put to sleep by Fed Yellen. Maybe the 10% pullback was related to that, but if it was the market wouldn't have made new highs so I throw that one out the window. The real reason for this bull market has been, is and always will be rates. The Fed knows how to bully the bears. She knows she can force market participants to remain as they are. If you get a moment, look at where those 2, 5 and 10-year rates are at. It doesn't take much to recognize her thought system. Very few people will take that route when the market is offering up better gains.

Potentially, much better at that, and that's why folks won't leave, even if they know things are truly out of control on the valuation side of the ledger. Now the excuse is that the economy is improving enough for folks not to have to worry about QE any more. Always an excuse if you need one. The only truth has been rates and that will continue to control the market big picture, with lots of selling episodes, of course, along the way to keep things honest. The Fed is in charge folks. She knows what she needs to keep doing to keep the economy alive and kicking. Get those 401K's to look good and the economy will follow. Add the reality of energy rates dropping and things are right where she wants them to be. The Fed rules are still in play. Make no mistake about that, thus, adjust your thinking accordingly.

The market daily-index charts, the key-index charts, are all set up in inverse head-and-shoulder patterns. They don't always play out, but they do have some degree of success that warrants attention. The S&P 500 measures to 2200. Makes no sense to get there as I've said based on reality, but the market isn't always about the truth we seek it to be. Never argue with price. There are enough problems that could easily destroy the pattern, but you need to respect it for what it is. The Nasdaq 100 is now in a seven-day bull-flag consolidation. That's not up for argument. If that flag breaks up, and out, the rest of the indexes will follow along. There are no guarantees of any kind that this will work out, but the longer the flag holds the better the odds are that all of the indexes will try higher still.

One-big gap down on the wrong piece of news can change the playing field, but, for now, why bother going against what's out there technically, until the bears can do something to change the entire landscape. Again, stay with the trend. We'll have some late stage losers, but ride the wave while the going is good.

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.

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