Is The Market About To Explode.....Higher? (SPX, DJI, UAUA, MSFT, APC, JPM)

No, I'm not drunk writing a title like that! But, it occurred to me that almost every article I read talks about what new short positions should be added and how we are headed back below 1,040 on the S&P (SPX) and perhaps even lower. What ever happened to the mantra: Don't fight the Fed? The fed funds rate is at historically low levels and will likely remain there until 2012. Deflation is more of a worry then inflation. The euro is also regaining its footing as austerity packages are being implemented in the PIIGS. S&P earnings are projected to be $84 in 2010 and $95 in 2011. That puts the forward price/earnings ratio for the S&P at 11.65. (Whether you believe those estimates or not is up to you). The private sector is addings jobs..slowly. Auto sales are up, consumer confidence is up, ISM manufacturing is up, rail freight traffic is up. Perhaps none of these are sustainable, or so the bears argue. The market is slowly regaining traction. The Dow (DJI) and Nasdaq have both climbed above their respective 200-day Moving averages. The S&P is hovering right below its 200-day MA at 1,106. Cyclical stocks like United Airlines UAUA and Microsoft MSFT are up nicely today. Laggards such as Anadarko APC and JP Morgan JPM are climbing out of the gutter as well. Interest rates and inflation are low, and the S&P is trading at a discount to its historic p/e ratio. This bodes ill for those that are playing on the short side. You can't fight liquidity forever!