Looks like European earnings of all things is presenting some happy feelings this morning. I saw on Bloomberg that the Europe composite is now trading at 28x earnings, so valuation appears to be moot worldwide.

I'll be dropping some short exposure this morning, adding to some of those RF semi names which surely will gap up at the open and if this is going to be one of those straight up all day days, will assess around 10-10:30 AM on going with some SPY call options. Almost every gap up day of this magnitude has led to strength all day - in fact I doubt I can remember one case it has not the past 5 months. I keep saying this very obvious pattern has to stop working as it is so well known by now, but it just keeps happening. The inability to break S&P 970 yesterday had me thinking I should be getting long but you just never know what news will break overnight. The train to S&P 1000 appears inevitable.

As an aside continuing jobless claims are falling (those are the long term unemployed). As we stated a month or so ago - this would eventually happen... the real reason for the majority of that is some people have now been unemployed for over 1.5 years and despite multiple extensions they have exhausted unemployment benefits. The market sees that as a positive because they do not like to look under the hood - somehow I guess they think people are heading back to new jobs. Maybe a small portion but the majority of these people who fell off the rolls are now going to be on welfare.... or hopeless - that's a green shoot.

Or if you drink Kool Aid, 100,000 people who just so happened to be in the long term unemployed rolls suddenly found work last week.

I continue to like the action in Quality Systems (QSII) and Ocwen Financial (OCN)

...looks like I missed the fact QSII reported this morning - missed on earnings and revenue but still only down 1% - lucky ducky