The major averages snapped higher today and followed the script we had been writing for the past several trading days. While it isn’t always easy to hold your ground during weakness, we’re glad we weren’t shaken out and our conviction prevailed. The S&P and DJIA remain technically healthy while today’s action in the NASDAQ and QQQQ was a fine first step towards repair.

Despite today’s move we continue to feel the negativity wafting through the air. The only potential negative was the light volume which will definitely be used in the bear argument when studying today’s action. We are taking the opposite position in thinking that today’s action could continue due to the negativity in effect climbing a wall of worry.

We’re particularly impressed with how the Bulls shook off this mornings CPI # as it seems evident higher interest rates are priced into this market. Leadership was in Bank stocks and technology which bodes well for a healthy market. Furthermore, the spark seemed to come from weaker oil which continues to show it has lost the momentum for the time being.

Today’s action was a good start to a solid move higher but and we’re watching closely to see where the next leadership group will be. For the time being it is still up for debate but when we know, you’ll know.