After running straight up for the past week, the market was due for a little rest -- and that is exactly what we had. We inched down most of the day on slightly negative breadth, and average volume but popped back in the closing hour as market players anticipated the GOOG earnings report.
Google's stock was rewarded by expectations of a good report as shares of the company popped 30 points. Google's strong action hoisted up the broader market as well. This is the first big positive response we've seen this earnings season, and it is going to be very interesting to see how the company performs tomorrow as the news is digested.
The bears have one very big problem right now: with QE 2 in the air, it is very unlikely that they'll be able to make any significant inroads to the downside. The Fed's printing press is more powerful than earnings and economic news. With Ben Bernanke clearly in the quantitative easing camp, this market has some very solid underlying fundamental support to go along with the technical support.
The little dip today obviously did nothing to damage the uptrend that has been in pace since the Sept. 1. And with Google now putting up a strong report, the fear of being left behind will keep the upside momentum going.
We have GE's earnings report in the morning, and there are obviously some issues with financials due to the mortgage mess. But this market is focusing on positives and is ignoring the convenient excuses for selling.
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