The only thing it seems that can hit this market hard to the down side in a sustainable fashion would be if the market smelled a rate hike cycle about to begin. Bad news on its own doesn't have any effect on how the market trades. The up trend remains in place.

We know this by two reports that came out this week. The first was the durable goods report, which showed a number well below expectations. Folks just aren't spending on those household goods. That bad news was follow up by really bad news on the GDP on two fronts. The q1 number was revised way down to 0.8% growth. To add insult to injury the market had to deal with a 1.2% number this quarter but the number was supposed to be all the way up at 2.6% growth. That's more than just your average miss. That's a disaster.

To have two key reports such as durable goods and GDP come in so far below expectations guarantees one thing. Rates are going to remain low for an extremely long time to come. It's inappropriate but that's reality. Ms. Yellen is a super dove and wants rates low in order to keep the market moving higher. Give her any excuse and that reality gets pushed well out into the future. These two reports tell me that she's not even thinking about raising rates this year. Probably well into 2017. She'd probably like to keep the rates where they are until she's thrown out of office or retires. She knows that 401 k's are the only way to keep this economy afloat. Without good news on that front every quarter the economy would sink even further than it already has. She's getting her wish in a strange way. Bad news on the economy is good news on the rates front and that's preferable for her. The real world isn't doing very well economically. The stock market is just fine.

The market has been trying to clear 2175 on a closing basis with some force for quite some time but still hasn't been able to do so. It tries day after day but gets rejected. The good news is that the rejections are not followed by any intense selling episodes. The market simply pulls back a bit and then tries again. If this continues it's bullish. At some point the right news will hit and off to the races we'll go. Inappropriately so, but up is up. Price dictates, not truth.

I'm not sure what news is out there that would kill the soul of the bulls but we aren't seeing it in anything based on global economies. The average person simply doesn't have any alternatives to work with that will satisfy them. Rates are too low so we grind higher and make no mistake about it, it is a grind higher. 2% above the 2134 breakout after a few weeks is weak. We should be exploding out with force after waiting so long to get that move up and out. The market has decided it's not sure 100% that breaking out is the right thing to do but the bears have been unable to seize the opportunity of moving laterally. Not enough sellers to bring it down hard enough, at least not yet.

When a market breaks out after such a long lateral consolidation it usually keeps going almost straight up for weeks if not months. We are not seeing that here. Maybe it's the lousy monthly divergences. Maybe it's the increasing froth. Maybe it's simply that things just don't deserve to go much higher. Who knows but the market is still in bull mode and close to a major breakout. Only if we lose 2134 is it bearish short to possibly medium term. Day to day in a very weird environment of disconnection between price and reality.