Today's strong surge to the upside is a bit of a positive surprise and most definitely helps the bullish argument for equity investors. So much so that we're going to take our recent theme of fading the rallies with put option purchases off the table now and move to a more neutral wait and see approach with the major indexes. However, I think it's important to note we're not quite out of the woods yet but today's move is enough of a surprise to potentially avoid swimming against a potential reversal of currents. Advertisement New Breakthrough Fuel Could Power Your Car It took the earth 300 million years to make the oil we burn. Imagine if we could squeeze that whole process into just a few months... a few weeks... or even a few days. Because that's exactly what could be happening. At least a half-dozen labs and companies are working on this, right now. If they get it right, we could literally "make" as much gas for your car as you need. We could make fuel for planes, trains, and diesel trucks this way too. Find out more by clicking here. Advertisement Today. we've got a broad fundamental look at some economic data we thought you may find very interesting, as well as a quick look technically. Here's where we're at from a technical perspective first... The DOW has taken out a new four year high while the S&P and the NDX have yet to do so. Some may disagree with this next comment but my experience has taught me that to try and rely on the technicals of the DOW, will often prove you’re crystal ball analysis wrong. The DOW, over the last ten years, actually seems to suck traders and investors in on new highs. Take a look back. What happened when the DOW made new highs back in late ’06 to ’07? It was the ultimate contrarian signal that the markets were on the verge of implosion. Don't get me wrong, we're not suggesting the market is on the verge of implosion here. All we're saying is that just because the DOW has made a new high doesn't mean that's the breakout signal for new highs to come across all of the major indexes. As a matter of fact, the DOW tends to serve as more of a safe haven for equities than its major index counterparts. It simply tends to slowly chug along like an overfed animal with no clear signals until it is too late. It almost reminds me of the slow kid on the soccer field who, when he finally reaches the other side, the rest of his team is at the other end of the field. It's not that I have anything against the DOW. There's plenty of great opportunities throughout the DOW, I just don't think that particular index is much good for determining what the market is going to do next. On the flip side, if the NDX or even the S&P for that matter takes out the April 3rd high, there's a high probability that this market is going to catch a lot of traders upside down and that will likely be a good enough foundation for this market to move much higher very quickly. If all we get is a failed test of that high, there's a good chance that it's all part of the necessary volatility to move this market lower. Regardless, today's move is a good solid signal that there's still enough speculators out there to keep the sellers honest. The Underlying Economic Tone Here at Home SCN Contributor, Bryan Murphy, posted up some very interesting commentary this morning that talks about some of the most important economic data points that he believes has been driving this market higher. If you're serious about investing, this is the kind of information that can not only teach many investors a thing or two, but also provide even the savviest of players with more info for their arsenal and when it comes to the market, like anything else, information is power. With about half of the first quarter's earnings numbers reported now, we can start to draw at least some conclusions regarding the market's health. For the S&P 500's stocks, earnings are on pace to be 7% better than the year-ago numbers. Apple's outsized beat is responsible for most of that improvement though. Without Apple, the increase is whittled down to 1.6% across the board. However, what stocks lacked in huge growth at least made up for it in participation with 70% of companies having posted an earnings 'beat', which is a little better than the recent average. The S&P 500's trailing P/E remains on the low side at 14.0. Overall, the market's Q1 earnings would merit a grade of a solid B. Not bad. Of course, Q1 is history and since stocks trade based more on the future rather than their past, we're going to have a look here at some of the recent economic numbers that deserve closer inspection. These are likely the driving force behind Q2's numbers. Unfortunately, their collective picture is a little tougher for most to understand than simple quarterly announcements from the biggest public stocks in the market. One of the biggest concerns is still the unemployment situation, which hasn't been getting better lately. In fact, the recent rise in continuing claims is getting outright alarming. It's not dire yet, but if new claims continue to edge even slightly higher (greater than 390K) and ongoing claims don't resume their downtrend (under 3.3 million), that could spell big trouble. Bad for stocks. As for the monthly jobs data, it's looking better. The total number of people working (any job) is on the rise, and the total number of unemployed people - whether collecting any benefits or not - is falling. Good for stocks. There's more good news from where we need it most. Capacity utilization and industrial productivity both continue to improve. As long as both are trending higher, so too should the market.... in the longer term. However, it doesn't dictate the pace of those gains. Good for stocks. Though it stares in the face of the popular "the consumer is dead" thesis, retail spending continues to actually march into record territory here at home. Although part of that is attributable to inflation, much of the growth is organic. That continued spending largely jives with stronger confidence. Though both have been hot and cold from one month to the next, the Michigan Sentiment Index as well as the Consumer Confidence Index remain in bigger-picture uptrends. Again, good for stocks. Although I don't feel it, inflation is in check at 2.65% (and falling). Another point for the bulls. On the real estate and construction front, though the rebound was actually called more than a year ago, it's actually only been within the last few months we've seen real evidence of a construction rebound.... yet we're still on thin ice. Multi-unit housing is carrying most of the weight, based on permits and starts data, so we'll call this one a wash for now. Bottom Line? If you were keeping score just now, the bulls would have won the economic argument 4-1. However, it remains to be seen if all of this is enough to overcome the typical summertime doldrums, which is historically the slowest time of the year for the markets. Time will tell. Advertisement Something Very Big Will Happen in America Within The Next 180 Days! It will touch Americans deeper than anything since the Great Depression. It will hit like a brick wall. Most people will not like what we have to say until they see the facts in this controversial new video. Our first five predictions have already come true. Fail to heed this financial warning at your own risk! Click here to see this video here now. Advertisement I will say this though... when you take a look at the underlying technical and fundamental landscape of where we're at, this market has every reason to go higher once it figures out where it wants to find a base. And, it appears to be doing its best to figure that out right now. Have an excellent day, see ya'll tomorrow.