The S&P 500 came within 11 cents of 5,000 yesterday, marking a remarkable 43% run since the October 2022 lows and 22% return since the October 2023 lows.
The month of February has a mixed track record over the past 10 years, with gains and losses evenly split. Stocks frequently pause at big, round numbers – which conflicts somewhat with the fact that stocks usually melt up into CPI prints.
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Note the little rising wedge which has set up on ES.
The most obvious pullback target is now the 2022 high of 4818.62 sometime around Feb 15. Remember, CPI will be released on Feb 13.
If there’s a hint as to whether or not TPTB will allow a pullback, I’m not seeing it. VIX remains on the verge of a breakdown, but it has been here 4 times since December 12. Note that its SMA10 has rolled over again and could easily drop through its SMA20 today. So, continue to keep an eye on it.
EURUSD is usually a good tell, but it’s been rather stubborn in feeding USD strength.
USDJPY has been better at it.
Bottom line, DXY should continue to rise, but will it do so in time to deliver a pullback in stocks before SPX 5,000? 
Oil and gas are still pointed higher, with Middle East tensions still providing support.
And, the 10Y is holding following yesterday’s backtest of its SMA10, 20 and 50.
continuing…