Stocks have been on an explosive move to the upside ever since seven days ago, when a swift, but short-lived decline was abruptly halted in an intraday reversal at 1645 on $SPX. Since then, $SPX has risen 88 points in very short order and doesn't seem to be done rallying yet.

$SPX has now made a new all-time high -- both intraday and closing. If it holds this level for another day, it should clear the way for further upside gains. Even if there is a pullback, there is support at 1710 and again at 1690.

Equity-only put-call ratios are still on sell signals. This is due in large part to distortions that were taking place: heavy put buying as protective measures by traders who were hedging long stock positions.

Breadth indicators remain on buy signals, and both are now in overbought territory. $VIX generated a spike peak buy signal and has now retreated a great deal and is already down to levels near 13 -- levels from which past selling has emanated.

In summary, all of the indicators are in a bullish mode, except the put-call ratios (which have been distorted by hedging activity). There are already overbought conditions, but they can persist while the market rallies. At this time, we remain bullish, with stops tightened up to recent support areas.

Lawrence G. McMillan is the author of two best selling books on options, including Options as a Strategic Investment, and also publishes several option trading newsletters.