The European Central Bank kept rates at the low 1% while fueling speculation that the loss on Greek bonds is lower than most anticipated. Meanwhile the IMF has raised it’s global growth forecast. All the “good” news has fueled a rally in the European markets and the Euro while weakening the Yen. Thus the European news supports the huge run up in the US equities yesterday. US jobless claims came in lower than expected causing the ES to break above it’s then overnight highs. Has the ES overextended itself? It’s very difficult to predict. The jobless claims did not fuel the kind of positive response we usually get from good economic reports lately, so maybe that’s telling us something. In general, after a large trend days like yesterday, the markets like to take a breather. Yesterday’s price movement has created larger than normal LVN areas. The ES is in the middle of the huge daily comp volume cluster centered at 1064. It will need to move through the 1080 LVN to get back into the 1100 cluster. We have plenty of resistance above created in the 3rd week of June, but just remember that if greed or fear kicks in, the LVN rejection areas are often ignored.