'Subtle bullishness'. It is hard to write these words, especially over the last 5 months. Seems like every time I did, some headline or EU action came out that destroyed any subtlety. However, now should be different because of what we know:
1. Banks will not be allowed to cause a credit event.
2. EU austerity is firmly in place.
3. Despite the ECB talk, they are and will continue to buy sovereign bonds.
A review of the financials and VIX suggest the markets are realizing this. The XLF seems to be chilling at technically significant level at its SMAs.
The above suggests a breach. And to further support the thesis is the Dollar and the Ten yr.
The UUP seems like a short-term pull back for the dollar, which should facilitate markets and commodities.