With a heavy short interest in the market, stocks are hardly taking the time to pause before breaking multi-month downtrends. Yesterday was a healthy digestion day, and a sign that bulls remain in control. Shorts are getting squeezed, adding fuel to the rally. Some stocks are starting to make new highs, making tremendous moves off the lows. Technically, the SPY will be knocking on the door of bigger resistance very soon. There is a small point of resistance at 1204-1206, and then the major zone is really 1220-1230.
*Disclosures: Scott Redler is long SNDK, SINA, JPM, XOM. Short SPY.