As mentioned this weekend that the rally which started on Friday was based on genuine buying besides covering for shorts. Today the market rallied further up. There was a broad-based buying again in all industries except few such as Gold&Silver, Financials, and few others.
S&P touched 1375 and backed off which is natural for any market hitting previous resistance. Dow Jones hit 12,922 and closed at 12,908. One point to be noted is that on July 5th Dow Jones made a high of 12,961 and S&P 1375. S&P already hit 1375 and it is at 1373 right now whereas Dow Jones have yet to hit 12,961 and not only hit 12,961 but cross it. When Dow Jones is crossing 12,961 S&P also must cross 1375 and heads toward 1390 (high probability target mentioned before).
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S&P could also go for 1405. Dow Jones should head for 13,100. In other words both markets must work together the high of July 5th.
IBM came out with good earnings today and tomorrow it will help Dow Jones in achieving the cross of 12,961.
If S&P continues its journey beyond 1405 then it could eventually head for 1435 by mid-August. First I will see what S&P does at 1390 level. The hesitancy will show its sign in the major stocks which are moving upward right now.