Yesterday’s rally was on moderate broad market volume but institutional volume was considerably higher. In contrast the trading has been mixed overnight with broad market volume strongly to the short side on moderate volume but big traders were buying the OL virtually exclusively – though that volume was quite light. Since the news we have seen some selling return to the institutions and deltas have gone negative though not with any significant volume. The bottom line is the PPI news was actually better than expected and the starts and permits though poor are really kind of old news. Traders have kind of priced in poor housing at this point and reactions tend to be short lived. We are just more focused on global debt issues, consumer spending, economy, etc. Again, the debt issues are largely priced in and again, the economy continues to show signs of strength. Evidence of the real estate negative “price-in” can be seen in Fannie/Freddy news being de-listed. Can you imagine? The market didn’t react at all. Nobody cares. The Euro has ranged overnight and shows new weakness on the impending issues but is really holding its own. The carry trade is coming off still but much of that is related to the Yen weakness combined with a bit of profit taking from the risk appetite trades coming into expiration. We were due for a pullback all things considered anyway. We did have a strong bid in fixed income this morning but that has completely reversed at this point. We will just have to monitor yields as we go and the reactions to the global debt issues as they relate to money flow. The bottom line is we still show signs of strength and the news has shaken off considering what it was. I think we should see some good rotational activity at key levels today. Be careful with the new OL as its connection to the 98-99 low volume notch is close and will likely pull it down. The cluster under that may also help prop it up along with the day S1. On the high side be aware of the same thing in that the OH is too close to YH which will likely pull price up to find the limits of supply. Beyond that, the acceptance cluster centered around the 13 handle or so is a rock and will very likely produce lots of rotational activity.