DJIA Hits Another All-Time High on Positive Economic Data, Earnings Reports and Falling Energy Prices

BOTTOM LINE: The Portfolio is slightly lower into the final hour on losses in my Computer and Telecom longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is mildly negative as the advance/decline line is mildly lower, sector performance is mixed and volume is about average. The DJIA hit another new all-time high today, and its chart continues to resemble 1983 rather than 1937. It appears as though the peak in subprime fears, which occurred the day the market bottomed on March 14, was in fact another excellent buying opportunity. I believe that most high net worth and institutional investors, much like the public at large, believe the U.S. is in a secular bear, or trading range, environment. I do not believe for a second that the parabolic move of assets into negative/low correlation U.S. stock strategies, especially market-neutral and commodity funds, will persist when psychology shifts away from this "irrational pessimism." I believe a major positive psychological shift will begin to occur, back toward the belief that the U.S. is in a secular bull, around the time when the S&P 500 convincingly takes out its all-time high of 1,552. We are 5.2% away from this level right now. I still expect this to occur later this year. I expect US stocks to trade mixed into the close as rising earnings optimism, lower long-term rates and lower energy prices offsets profit-taking.