We still remain skeptical of this rally, and frankly were surprised at how the market responded to yesterday’s sell-off. However, the volume is waning at a rapid and ferocious pace – and that is on top of an incredible piece of news in regards to new home construction increasing for the month of February. So don’t get caught up in the point totals of each of the indices but instead focus on the overall decreasing amount of volume with each consecutive rally – that is a sure fire sign that this rally is running out of steam. It is also hard to take a rally serious until you’ve seen how well it responds to its initial pullback and whether it can rally to create a new high.

Here’s the Nasdaq and S&P charts…