EARNINGS OR ECONOMICS?

Over the last week, earnings have trumped economics as earnings reports have been outstanding and economic reports have been anemic to poor.  Europe continues to boil over as Spain is nearing where Greece found itself several months ago.  Apple, Amazon and a host of other companies have posted blow out earnings that have provided enough fuel for the markets to withstand the onslaught of negative economic news.  We will continue to see a flurry of earnings over the next couple of weeks and hopefully they will continue to impress and lead this market higher.  QE3 also lurks in the background and there is talk again that "bad news" is "good news" in that continuing bad economic news will force the Fed to launch another round of liquidity.   The latest Fed easing is scheduled to come to a close at the end of June so we may see something sooner rather than later if the economic news continues to falter as we head into the summer season.  Sell in May?  We'll see but for now the market is weathering the storm and continues to be bound by the highs of April 2nd and the lows of April 10th.   The S&P currently trades in the middle of this range and a break in either direction will likely set the stage for the next month or two.