10:47 am EDT:  Of the three scenarios from the morning report, 2 is the frontrunner now:

1)     The majority of the leaders are correct and equities will correct today.   This means we either have a perfect double top at 1038.75, or we will get an extension beyond the highs, which will be reversed late day.

2)     The majority of the leaders are correct, but will tread water while equities head higher and eventually reverse next week.

3)     The majority of the leaders are incorrect and equities will continue to post new material highs with the leaders reversing into next week (gold higher, Treasuries and the Dollar lower).

Mainly, because we still expect a final short squeeze and it is unlikely to happen today.  With only the 30 Year auction left on the news calendar today, it would take a serious failure to pump equities to new material highs. 

Accordingly, we’re willing now to fade the range from upper (1036.25 to 1039.50) to lower (1027.50 to 1030.00).  If the extremes are violated by more than a point without a quick reversal, we could have a breakout and will no longer fade.