There is no getting around it. The stock market believes that this time the Geitner plan to fix the banking system is serious. Having nailed the bottom in my March 10th post and having predicted that the market would run into resistance at Dow 7,800 - 8,000, it is time to be flexible.
Therefore, I am upgrading my target to the Dow 8,500 - 9,500 zone. I know, that sounds insane, but the thrust of today's rally at the top of the trading range tells me that this market has more legs.
Having said that, I fully expect to see some profit taking kick in at Dow 7,800 - 8,000. After that it is not a great leap to hit the bottom target of 8,500 - especially given the breadth of today's rally and the extent of the government's economic stimulus.
Nonetheless, it would not hurt to take some profits from here on up, but I would now let some of it ride. The market can easily reach its 200 day moving average, its downtrend line and resistance levels all around Dow 9,300- 9,500 - and still look like it is at the bottom of the abyss!
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