Testy Tuesday – Back to Breakout Levels Already

As you can see from our Big Chart, the technical picture has quickly turned around and, once again, a Santa Rally is a possibility and our S&P 1,450 goal for 2012 is in reach.  As I said to our Members earlier this morning: 

How quickly things reverse.  Still, don't mean a thing until we top those last week highs and break over 1,440 on the S&P (5% line) and 8,400 on the NYSE (already there) and 840 on the RUT (5% line).  That puts the Nas 5% behind the others and the Dow 7.5% so if we get a bullish break on our 3 broad indexes – it would be good to play the Nas and the Dow to catch up but first – we need to break those 5% lines. 

So, that's what we'll be watching this morning as well as our beloved AAPL (see David Fry Chart), which popped back to $520 yesterday, on the way to our $528 initial target (as noted in yesterday's Morning Alert).  We had hoped to hit it yesterday but we settled for the $16 move we did get and we expect to see $528 this morning or our premise is blown and we'll pull our aggressive short-term bets.

We are, in theory, making progress on our Fiscal Cliff negotiations but Dave Fry notes there is a more important macro driving us forward at the moment:

Beyond all of this is what the Fed wants you to do—buy stocks. After all, they’re providing nearly $100 billion a month in QE activity. This money will find its way into markets and will force you to buy stocks even if you don’t want to. Why? Because the alternatives are negative yields in bonds and sideline cash.

The same holds true with other central banks in Europe and Asia as its raining fiat currencies.

Not to be outdone, Japan’s election provided a large

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