As we all know, the major stock indexes have surged higher since October 4, 2011. On that date the S&P 500 Index e-mini futures (ES Z1) undercut the August 9, 2011 low before staging a massive rally in the final 45 minutes of the trading day. That chart pattern will usually create a low for several days to several weeks before showing signs of weakness again.

Normally, after a large rally or decline the next trading session is much more subdued or quiet. Yesterday, the stock markets surged sharply higher with the Dow Jones Industrial Average gaining over 300.00 points by the end of the day. The rally was broad based as most every leading stock sector participated.

Stocks ran into a master resistance today. The S&P 500 hit 1159. This is a three bar surge on the daily chart and a major resistance point. The markets are now eying the Non Farm Payrolls report tomorrow at 8:30am ET. After a 7.5% move up in the last few days, smart traders and investors are taking profits to protect themselves. The S&P 500 is trading at 1151.

As you may know, the major stock market indexes have been struggling since topping out in May 2011. Since that time, there has only been one way to get this market to trade higher; the U.S. Dollar Index has to decline. That's right, unless the U.S. Dollar Index sells off or declines the stock markets cannot seem to trade higher. In fact, when the U.S.