Now that every bear – even the folks at Elliott Wave – has thrown in the towel, the market may have permission to soften up some. Of course, the legend of OPEX week – particularly a four-witch one – has a couple more sessions to hold sway.

I find the chart below of the Small Cap 600 index to be interesting based on the relationship of its price to the Fibonacci arcs. It seems to cling to those arcs rather nicely, and prices are on their third swoop higher relative to the closest arc. The most recent rally was explosive, similar to the one experience last summer during late July and early August.

I'll also mention that, having gone through my thousand charts last night (which is a daily thing for me now, whereas it used to be weekly), I did smoke out a bunch of bullish charts………but they are almost without exception crummy little companies (like CROX). I like the charts, yes, but there's no doubt this rally is based on crap stocks (rinky-dinky banks in particular, plus insolvent GSEs) and little else.