Quote from K89:
I think the indicators point to more sideways action. Strong economic numbers (low inventories combined with strong consumer spending = turning the corner on job creation) plus very good earnings out of the majority of companies, offset by low VIX (excess complacency) and a few high profile companies who have disappointed and hogged the news.
What is interesting is that a lot of hedge funds were long Oct Puts that just expired. They did not roll their insurance into Nov., so the market is much more vulnerable to overreaction on the downside now and going foward into the end of the year