On a wing and a prayer: Cautious optimism as market rebounds

Barring further unexpected bad news, even the cynical Reformed Broker believes the Dow's big rally yesterday can continue on today. Just don't let President Obama go on television before the closing bell.

The ingredients are in place for yesterday's big stock rally to continue barring any fresh shocks...

• Bernanke speaks today and the Interest Rate Lorax is sure to give the market the kind of "we stand ready" and "accomodative" happytalk that it wants to hear.
• China just cut rates by 25 bps, both a tacit admission that it is choking on slack demand but a positive on balance nonetheless.
• Spain got $2 billion worth of bonds sold this morning.  It was a total hustle, with Spanish banks themselves stepping up as the big buyers (demonstrating confidence!) and the lowest amount of ten-year sold since 2004 in the mix.  But still.  The country has covered a little more than half of its necessary funding for 2012.  Long way to go, but again, this is a net positive.
• Weekly claims should be blah in comparison to the NFP shocker.
• Earnings are behind us and we're not into warning season yet.
• Sellers below 1300 SPX seem to have been cleaned up for now.  Sellers above 1300 seemed to have been non-existent yesterday - it's a confidence thing: below that level they want out, above it they're satisfied to sit tight and see what happens.

If we can keep Obama off TV today and make it through the European close at mid-day, we should be alright.

Last Friday we put on a placeholder position in $WMT and added to existing longs in our fave fundamentally-weighted index holdings ($SDY, $DEM, $XBI etc).  Other than that, sitting on our hands - we still believe the worst is still somewhere out there on the horizon even while we welcome this respite.