Equity bulls have been getting nothing but good news for over two months, and this morning was just icing on the cake, as the CPI came in vastly below expectations.

As such, equity futures are all green, with the /RTY in particular up strong, about 1.5%. It already conquered its Fibonacci a few days ago, and now it’s heading to the green line.

What’s the green line? It’s not a Fib. Instead, it marks the bottom of the topping pattern. I’ve been pointing out the “face-off” between the bearish pattern (everything above the green) and the bullish one (everything below the $2150 Fibonacci). Even now, before the open, the bulls are very close to besting this line, smashing the last wispy bearish hopes.

The /NQ is up about half a percent, getting within spitting distance of the lifetime high it set months ago.

Precisely the same situation holds true for the /ES.

And, naturally, any last scintilla of fear has exited the building, as the VIX plunges ever-deeper.

The supposition, it would seem, is that Powell has the all-clear to drop interest rates next week. The /ZB futures have stabilized above their supporting trendline, and so long as they don’t break it, they have a chance at ending a bear market in which bonds have been mired for half a decade.

The only good news for me is that I’m at the lowest exposure level in months – – less than one-third of my buying power – – although the opening bell is still going to sting somewhat. At least with China and the CPI out of the way, a tremendous amount of uncertainty has been removed, and we can analyze what’s going on with more clarity.

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