10:16 am EDT:  The ES traded down to the value area (1108.00 to 1108.75) we wanted to see supported, though it did so ahead of the open.  Trend line resistance from the prior two day’s highs has temporarily impeded the ES’ progress with 1119.00 the high.  We would not be too quick to jump in long near highs as there will be some natural profit taking from the immense move, now that the markets have settled a bit.  No shorts for us as long as 1108.00 holds.

An interesting development in the US Dollar is that it has rallied along with equities this morning, though it is backing off of downward channel resistance a bit.  We are not quick to call correlation breaks, because they happen infrequently.  However, the world appears to be buying into a fundamental recovery in the US.  To confirm a correlation break, we would need to see the USD Index break out of its downward channel next week and trade above 76.00 with equities continuing to make new highs simultaneously.  For now, this seems unlikely.