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The markets continue to perform giving credit to the euro zone finance ministers for securing a deal that will enable Greece to avoid a March default. However, the reality is we're in a technical runaway in the major indexes right now with no significant resistance in near site. We did mention last week we find it interesting that the DOW and the S&P have replaced the NASDAQ as the leaders of the rally which could prove to be of importance in the coming weeks ahead but for now let's continue to keep the risk on and not make too much of it.

It could be the fact that some of the NASDAQ 100 stocks like Apple (AAPL) and Amazon (AMZN) have moved too high too quickly or it could be a rotation into more cyclical names and conservative ideas. The latter would suggest the big money is getting a little nervous at current levels and sees some weakness ahead so we'll continue to monitor things closely and let ya'll know if that starts to become a real issue.

If gold finds legs, I would assume the rest of the market will likely diverge and vice versa so we're keeping an eye on gold as well. If you missed our edition, "Is Gold Finally Topping Out?" back on February 10^th, I suggest you have a read. You'll see just what we're referring to as gold appears to be at a critical trading level.

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Hope you've all been having a good week and are ready for a nice three day weekend. I've got some interesting reading for you today on the topic of short selling. It's a mysterious component of the market to many retail investors but a very common and widely accepted strategy for many savvy traders and professionals within the equity markets. This could prove very educational to some of you and I think it's an important aspect of the market that everyone should understand.

First, let's dig into our two cents on the market's behavior of late. The trend continues to be your friend. The "buy the dips sell the rips" methodology continues to work. Yesterday was an important move for the major indexes following Wednesday's fast and furious selloff because as we suspected the markets came roaring back yesterday to wipe out Wednesday's losses. This keeps the bullish trend intact. We keep saying all along don't fight the tape... the trend is your friend because when you can identify the market's behavioral pattern there's usually money to be made.

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Before I get into this morning’s edition, I wanted to take a minute and say thanks to all of you SCN Members who have sent us your feedback lately. I say that on behalf of everyone here. We really appreciate all of it and do take the time to read every single one. It’s very insightful and your compliments have been humbling… so a BIG thank you! Guess we have to continue to step up our game. No pressure, ha.

Moving right along... we're starting to see a little bit of volatility once again as the markets traded off this morning. However, as I type, it's making an effort to erase those gains which has pretty much been the theme of late. There's really no clear sign or technical indicator that this market wants to go the other way just yet.

Retail numbers missed estimates this morning and there's some chatter regarding a delay in the housing rebound. Speaking of housing, I read an interesting article this morning talking about how the Federal Housing Administration will exhaust its reserves over the coming year, according to budget projections released Monday, which would require a Treasury infusion for the first time in its 78-year history. Wow. We are living in different times no doubt. Check out the article if you want to scratch your head as well. So the monetary policy sagas at home continue. It doesn't appear the market cares much... yet.

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Good Monday Everyone... hope you all had a great weekend. I hope you’ve got your rally cap on because it appears the markets are very aware of Valentine’s tomorrow... there’s plenty of love in the air. The markets gapped up rotating more short sellers this morning with a vote of confidence for the bullish trend that continues to make new short-term highs with all of the major indices. However, the news pundits can only seem to attribute the move higher to Greece and now an underlying improvement in the Asian economies when in fact the real reason for the market’s strength is a bet that we’re improving the economic landscape here at home and investing in America is become the preferred global theme once again.

The NASDAQ is in no man's land just ripping and leading all major indexes higher. I've noted in recent editions that the underlying strength of tech is the main foundation of the rally. Tech is leading the charge and it's my belief that will continue throughout the rest of the year. I don't see any other major sector of the market heating up quite like tech has and will likely continue to do so. That includes clean tech, computer tech, wireless tech, biotech and whatever any other kind of tech you can think of. Tech is where we want to be.

The S&P and the DOW have been no slouches either. Although they are only testing their 52 week highs or slightly higher, that's still an impressive move nonetheless. If the economy proves to seriously be shaping up, we can expect those two indexes to catch up and move in line with the NASDAQ... but for now, risk is on and tech is it.

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IIFA... is it Friday already? Interesting move earlier this morning in the major indexes. Maybe my observation from yesterday is starting to play out. I mentioned that this market had a "sell the news" feel to it. Today, the markets made a pretty quick and furious move to the downside and as I type, the markets are doing their best to erase those intraday losses which has been the theme of late. The only difference is this morning's move down was a bit stronger and with more conviction than we've seen of late. The close today will likely prove critical to what will transpire next week. It's too soon to tell but if volatility starts to pick up, things are going to get pretty interesting pretty quickly.

One thing I've learned in the market is anything can happen and it likely will. That sounds like a Yogi Berra comment, eh? A true hero of mine going all the way back to the late 60's and early 70's when he would entertain us to no end. I digress. Since it is Friday, I kicked around a few different subjects for today's edition. I narrowed it down to two choices. Is gold topping out? Or, how to short sell stocks you don't like. I opted for the first. Why? From a timing perspective, the gold charts are looking very interesting right now and if we can peg it before the rest of the Street, then we're going to make some serious money or save some serious money if you've been long gold for quite some time like so many other investors.

Has Midas Overextended His Touch?